For each $1 of a tax cut, economists expect consumption to
A. decrease by $1.
B. decrease by less than $1.
C. increase by less than $1.
D. increase by $1.
Answer: C
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The Bureau of Labor Statistics has taken several steps to reduce the bias in the consumer price index. Which of the following is not one of the steps taken to reduce the bias?
A) conducting a point-of-purchase survey to track where consumers actually make their purchases B) using statistical methods to reduce the size of the quality bias C) updating the market basket every two years, rather than every 10 years D) incorporating substitutions by consumers when prices of specific products rise rapidly
Foreign investment is considered direct only when
a. the foreign firm owns what is considered a controlling interest b. the foreign firm owns at least 50.1 percent of the company c. all foreign stockholders together own at least forty percent of the company d. the foreign firm has control of key patents e. none of the above
An Engel curve
A. always slopes down for an inferior good. B. may slope up or down for a normal good. C. does not relate to the normal or inferior good concepts. D. always slopes up for an inferior good.
The long-run aggregate supply curve occurs at the level of real GDP consistent with
A. the natural rate of unemployment. B. low levels of inflation. C. no inflation. D. individuals' tastes and preferences.