During normal times, the multiplier effect of an increase in government spending financed by taxes will be
a. strengthened, if the additional spending flows into sectors of the economy where the unemployment rates are low.
b. weakened by an offsetting reduction in spending due to the higher taxes.
c. unaffected, as long as the higher taxes are in the future.
d. strengthened, if corporate tax rates are increased and personal tax rates remain unchanged.
B
You might also like to view...
If people have the same abilities, then
a. they cannot gain from trade. b. they can still gain from trade if they have different tastes. c. they can still gain from trade as long as they specialize in different activities. d. they can still gain from trade only if they are facing different absolute prices.
Spending on the war in Afghanistan is essentially categorized as government purchases. How do decreases in spending on the war in Afghanistan affect the aggregate demand curve?
A) They will shift the aggregate demand curve to the left. B) They will shift the aggregate demand curve to the right. C) They will move the economy up along a stationary aggregate demand curve. D) They will move the economy down along a stationary aggregate demand curve.
Division of customers by territory or customer type is illegal
Indicate whether the statement is true or false
The CPI is determined by computing:
A. an average of prices of all goods and services. B. the price of a basket of goods and services that changes every year, relative to the same basket in a base year. C. the price of a fixed basket of goods and services, relative to the price of the same basket in a base year. D. nominal GDP relative to real GDP.