In order to maximise tax revenue, which of the following goods should the government choose to put a higher rate of VAT?
(a) St Bernard cornflakes with a PED value of -8.0.
(b) Eggs with a PED value of -0.4.
(c) Frozen vegetables with a PED value of -2.8.
(d) Aldi milk with a PED value of -4.0.
Answer: (b) Eggs with a PED value of -0.4.
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An unplanned decrease in inventories results in
A) actual investment that is greater than planned investment. B) an increase in planned investment. C) actual investment that is less than planned investment. D) a decrease in planned investment.
Like the monetarists, new classical economists favor
a. money growth aimed at achieving a nominal GDP target. b. discretionary policy action. c. a money growth rate that stabilizes output. d. a money growth rule that guides monetary policy.
If a nation has the lowest opportunity cost of producing a good, that nation has a(n) ________ in the production of that good.
A. absolute advantage and possibly a comparative advantage B. absolute advantage C. comparative advantage and an absolute advantage D. comparative advantage
Refer to Figure 8.7. If Buffy gives 17 perms per day, her daily profit is A) $3. B) $10. C) $45. D) $51.