The supply-side effects of a reduction in taxes are the result of
a. increases in the disposable income of households accompanying reductions in tax rates.
b. the stimulus effects of increases in government expenditures.
c. increased attractiveness of productive activity relative to leisure and tax avoidance.
d. reductions in interest rates that generally accompany expansionary fiscal policy.
C
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U.S. households use about 75 gallons of water per capita per day on the average because
A) the price they must pay for water is low. B) there is so much fresh water in the U.S. C) they use water in irrational ways. D) water is a basic necessity of life. E) water is a basic right.
Suppose product price is $24; MR = MC at Q = 200; AFC = $6; AVC = $16 . What do you advise this competitive price-taker firm to do?
a. Increase output. b. Decrease output. c. Shut down operations. d. Stay at the current output; the firm is earning a profit of $400. e. Stay at the current output even though the firm is losing $200.
The poverty rate dropped from 84 percent in 1981 to 11.2 percent in 2010 in what country?
A. India B. Chile C. South Africa D. China
What is true of the price elasticity of demand faced by a monopoly firm?
A) Demand is inelastic. B) Demand is more elastic at lower prices and more inelastic at higher prices. C) Demand is perfectly elastic because the monopolist has no competition. D) Demand becomes more elastic as the range of imperfect substitutes expands.