Starting from long-run equilibrium, a large tax cut will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; higher; higher
B. expansionary; higher; potential
C. recessionary; higher; potential
D. recessionary; lower; lower
Answer: B
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Refer to the figure below. There would be an excess supply of 25 at a price of ________. 
A. $35 B. $20 C. $45 D. $50
For most goods and services, the burden of a tax is on the sellers
Indicate whether the statement is true or false
Which is true of output-choice models of oligopoly behavior?
A) Both the Stackelberg and Cournot models can be constructed as sequential games. B) The Stackelberg, but not the Cournot, model can be constructed as a sequential game. C) The Cournot, but not the Stackelberg, model can be constructed as a sequential game. D) Neither the Cournot nor the Stackelberg model can be constructed as a sequential game, but other output-choice models can be. E) There is no relationship between any output-choice model and sequential games.
John Maynard Keynes's central proposition that a dollar increase in disposable income would increase consumption, but by less than the increase in disposable income, means the marginal propensity to consume (MPC) is:
A. greater than or equal to one. B. equal to one. C. less than one, but greater than zero. D. negative.