Starting from long-run equilibrium, a large tax increase will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. recessionary; lower; potential
B. expansionary; lower; potential
C. expansionary; higher; potential
D. recessionary; lower; lower
Answer: A
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A) by random selection. B) by comparing the costs and benefits of various options. C) solely on the basis of tastes and preferences for various options. D) by replicating the choices made by other economic agents.
Which of the following are typically financed in a "stock market"?
i. shares sold by a firm to finance its international growth plans ii. new mortgages for home buyers iii. credit card balances A) i, ii and iii B) ii and iii C) ii only D) i and iii E) i only
All else constant, an increase in the incomes of consumers in the market for diamonds would cause the supply of diamonds to increase
Indicate whether the statement is true or false
The law of diminishing marginal utility guarantees that demand curves will have positive slopes
a. True b. False Indicate whether the statement is true or false