The Law of Diminishing Marginal Product is defined as that part of the production function when Total Product declines.
Indicate whether the statement is true or false.
Ans: True.
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Starting from a situation of full employment, an increase in aggregate demand creates ________ and ________ the price level
A) an inflationary gap; raises B) a recessionary gap; lowers C) a recessionary gap; raises D) a recessionary gap; does not change E) an inflationary gap; lowers
If the Fed reduces the discount rate, which of the following are most likely to result?
a. The money supply curve shifts rightward, and the equilibrium interest rate falls in the money market. b. Investment declines, causing the aggregate demand curve to shift leftward, reducing equilibrium real GDP and thus slowing the economy. c. Investment rises, causing the aggregate demand curve to shift rightward, increasing equilibrium real GDP and thus accelerating the economy. d. Both a. and b. above are correct. e. Both a. and c. above are correct.
Ceteris paribus, which of the following is true about the concept of crowding out?
A. It increases the private sector's ability to raise the level of output. B. It occurs when spending increases are matched with tax increases. C. It does not affect the private sector's ability to raise the level of output. D. It reduces the private sector's ability to raise the level of output.
?Scenario: You are a U.S. taxpayer who had taxable income of? $200,000 in 2017. You paid? $49,400 in individual income? taxes, and you paid 33 cents of the last dollar you earned as individual income tax. Your marginal tax rate is? ________
A. 33 percent B. 0 percent C. 49.4 percent D. 24.7 percent