Automatic fiscal policy instruments include
A) Government contracts. B) Regressive income tax rate schedule.
C) Unemployment compensation. D) None of the above.
Answer: C
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Suppose per capita real GDP grows by 3.5% per year. Based on the Rule of 70, approximately how many years will it take for the level of per capita real GDP to double (i.e., increase by 100%)?
A) 10 years B) 35 years C) 20 years D) 3.5 years
An increase in the number of workers hired by a firm could result from
A) a decrease in the marginal product of labor. B) a decrease in the marginal revenue product of labor. C) an increase in the real wage. D) a decrease in the real wage.
If you were building a macroeconomic model that explores the effect of an increase in income tax rates on the size of the labor force, the exogenous variable(s) would be
A) income tax rates. B) the size of the labor force. C) both income tax rates and the size of the labor force. D) neither income tax rates nor the size of the labor force.
Which of the following stands true for income inequality?
a. The benefits of increased economic growth are widely shared in the First World countries. b. As a result of globalization, income inequality in China has decreased. c. The decrease in income inequality in China is an effect of socialist policies in that country. d. The gap between rich countries and globalized developing countries has shrunk. e. Internal migration has played a big role in reducing the income inequality in China.