An increase in the tax wedge associated with a given economic activity will decrease the level of that activity
Indicate whether the statement is true or false
TRUE
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According to the neo-Keynesians, the Phillips curve is stable over time
Indicate whether the statement is true or false
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
Tom buys a futures contract for U.S. Treasury bonds and on the settlement date the interest rate on U.S. Treasury bonds is lower than Tom expected. Tom will have:
A. lost money on his long position. B. gained money on his long position. C. gained money on his short position. D. lost money on his short position.
According to the graph shown, total surplus is:
A. $50. B. $90. C. $130. D. $25.