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
You might also like to view...
According to the graph shown, the monopolistically competitive firm:
These are the cost and revenue curves associated with a monopolistically competitive firm.
A. will earn positive profits equal to area A.
B. will earn positive profits equal to area C.
C. will earn negative profits (a loss) equal to area A.
D. will earn negative profits (a loss) equal to area B.
The demand for luxurious goods are usually unaffected by an increase in income
a. True b. False Indicate whether the statement is true or false
Suppose your employer offers to match funds you place into a savings plan as long as you purchase the company stock and hold it for at least three years. Which of the following is true?
What will be an ideal response?
When the price of gas goes down and the demand for tires goes up, a likely possibility is that tires and gas are:
What will be an ideal response?