An example of an automatic stabilizer is
A) personal income taxes.
B) inheritance taxes.
C) veterans' benefits.
D) corporate dividends.
Ans: A) personal income taxes.
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If the nominal interest rate is 11 percent and the inflation rate is 9 percent, then the real interest rate is approximately
A) 2 percent. B) 20 percent. C) 4 percent. D) 18 percent.
A decrease in demand, accompanied by a simultaneous decrease in supply, will always cause the equilibrium price and quantity of the good to fall
Indicate whether the statement is true or false
All mutually beneficial trades have taken place. This implies that
A) the production possibilities curve is bowed out. B) society is inside the production possibilities curve. C) economic efficiency prevails in the society. D) society is on the constant cost portion of its production possibilities curve.
In Figure 5.8, if the supply curve moves from S1 to S4,
A. the firm will go from making an economic profit to a loss that is big enough to make it want to shutdown. B. the firm will make a smaller economic profit than they used to. C. the firm will go from making an economic profit to a normal profit. D. the firm will go from making an economic profit to a loss but one that is not big enough to make it want to shutdown.