If the economy in the graph shown is at point D, and the government wished to bring the economy back to its long-run equilibrium, it might:
A. increase government spending.
B. decrease income taxes.
C. increase corporate income taxes.
D. All of these would bring the economy back to potential GDP.
C. increase corporate income taxes.
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From 1980 to 2014, the average annual growth rate for the Mexican economy has been 0.8 percent. Based on that growth rate and using the rule of 70, the number of years it will take real GDP per capita to double in Mexico is approximately
A) 9 years. B) 11 years. C) 56 years. D) 88 years.
James used $200,00 . from his savings account that paid an annual interest of 10% to purchase a hardware store. After one year, James sold the business for 300,000 . His accountant calculated his profit to be:
a. $300,000 b. $100,000 c. $80,000 d. $20,000
Donald produces nails at a cost of $200 per ton. If he sells the nails for $350 per ton, his producer surplus per ton is
a. $150. b. $200. c. $350. d. $550.
The story of the prisoners' dilemma shows why
a. predatory pricing is clearly not in society's best interest. b. economists are unanimous in condemning resale price maintenance, since it inevitably reduces competition. c. oligopolies can fail to act independently, even when independent decision-making is in their best interest. d. oligopolies can fail to cooperate, even when cooperation is in their best interest.