One way to describe the tax multiplier is that it equals the
a. the spending multiplier
b. the negative of the spending multiplier minus1.0
c. the GNP gap minus the GDP gap
d. the reciprocal of the marginal propensity to consume
e. the best estimate of the optimal tax rate
B
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While you were an intern you bought 5 packages of hot dogs a month. After acquiring a full-time job with a considerably higher salary, you stopped purchasing hot dogs. For you, hot dogs are a
a. Complementary good b. Normal good c. Inferior good d. Substitute good
The No-Good Company produces goods that provide damages to society-at-large. If consumers of No-Good's products fail to take external benefits into account
A. the demand curve will be too far to the right. B. the supply curve will be too far to the left. C. the demand curve will be too far to the left. D. the supply curve will be too far to the right.
A substantial amount of trade between industrialized countries is intraindustry or intrafirm trade rather than interindustry trade
Indicate whether the statement is true or false
Fiscal policy most directly affects the economy by increasing or decreasing:
A. long-run aggregate supply. B. the money supply. C. interest rate. D. aggregate demand.