If the government cuts the tax rate, workers get to keep
a. less of each additional dollar they earn, so work effort increases, and aggregate supply shifts right.
b. less of each additional dollar they earn, so work effort decreases, and aggregate supply shifts left.
c. more of each additional dollar they earn, so work effort increases, and aggregate supply shifts right.
d. more of each additional dollar they earn, so work effort decreases, and aggregate supply shifts left.
C
You might also like to view...
The fact that output gaps will not last indefinitely, but will be closed by rising or falling inflation is the economy's:
A. income-expenditure multiplier. B. self-correcting property. C. short-run equilibrium property. D. long-run equilibrium property.
A two-part tariff refers to a pricing schedule under which a buyer must pay a fixed fee for the right to purchase the product, in addition to a per-unit price
Indicate whether the statement is true or false
In the long-run equilibrium of a market with free entry and exit, if all firms have the same cost structure, then
a. marginal cost exceeds average total cost. b. the price of the good exceeds average total cost. c. average total cost exceeds the price of the good. d. firms are operating at their efficient scale.
Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4Refer to Figure 2.4. The economy moves from Point A to Point D. This could be explained by
A. an increase in economic growth. B. a change in society's preferences for motorcycles versus hybrid cars. C. a reduction in unemployment. D. an improvement in technology.