If the MPC for an economy is 0.90, a $4 billion increase in taxes will ultimately cause consumption to decrease by
A. $3.6 billion.
B. $40 billion.
C. $36 billion.
D. $4.4 billion.
Answer: C
You might also like to view...
If the price level increases, the AE curve shifts
A) upward and the AD curve shifts leftward. B) upward and there is a movement along the AD curve. C) upward and the AD curve shifts rightward. D) downward and there is a movement along the AD curve. E) downward and the AD curve shifts rightward.
Gerald is deciding what kind of light bulbs to install in the light fixtures in his new home. He has it narrowed down to compact fluorescent bulbs (CFLs) or LED bulbs. The CFLs will cost $350 and the LEDs will cost $900
Gerald estimates that the energy-saving benefits from the CFLs will be $750 and the energy-saving benefits from the LEDs will be $1,250. Based on these numbers, Gerald should purchase the A) CFLs because the cost is cheaper. B) CFLs because the the net benefit is greater. C) LEDs because the benefit is greater. D) LEDs because the net benefit is greater.
How much is the concentration ratio in this industry?
New firms enter a monopolistically competitive market structure in the long run if the price charged by the existing firms in the short run ________
A) exceeds the average total cost of production B) equals the average fixed cost of production C) equals the average variable cost of production D) equals the price charged in a perfectly competitive market