If demand is unit elastic and the labor supply is ________, the payroll tax is borne mostly by the employer.
A. perfectly inelastic
B. very elastic
C. unit elastic
D. very inelastic
Answer: B
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If real GDP grew 5 percent last year and the population grew 2 percent, then real GDP per person grew by ________ percent
A) 2 B) 5 C) 3 D) 7 E) 10
For a large firm that produces and sells automobiles, which of the following costs would be a variable cost?
a. the $20 million payment that the firm pays each year for accounting services b. the cost of the steel that is used in producing automobiles c. the rent that the firm pays for office space in a suburb of St. Louis d. All of the above are correct.
Figure 9.1 shows three aggregate demand curves. A movement from curve AD1 to curve AD0 could be caused by a(n)
A) increase in government spending. B) decrease in taxes. C) increase in the price level. D) decrease in the money supply.
If India decides to enact environmental laws to reduce air pollution, what would be the effect on GDP?
A) GDP would decrease if the pollution controls reduce productivity by more than the cost of the controls. B) GDP would increase as the environmental costs of pollution were not included in the calculation of GDP. C) GDP would increase as the citizens of India were made happier as the air pollution was reduced. D) GDP would increase reflecting the fact that the air would be cleaner.