Which of the following statements is true?
A. Economists believe that marginal and average tax rates influence behavior to the same extent.
B. Economists believe that neither marginal nor average tax rates have any influence on behavior.
C. Economists believe that average tax rates have a greater influence on behavior than marginal tax rates.
D. Economists believe that marginal tax rates have a greater influence on behavior than average tax rates.
Answer: D
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Does the gross domestic product account measure the market value of all goods and services?
A) No, because that would include double-counting. B) Yes, because the data is readily available. C) Yes, except for illegally exchanged goods and services. D) Yes, otherwise the gross domestic product accounting system is not a reliable indicator of economic activity.
Suppose a positive technological change in the production of disease-resistant corn caused the price of corn to fall. Holding everything else constant, how would this affect the market for wheat (a substitute for corn)?
A) The demand for wheat would decrease and the equilibrium price of wheat would decrease. B) The supply of wheat would increase and the equilibrium price of wheat would decrease. C) The demand for wheat would increase because consumers could afford to buy more wheat and corn. D) The demand for wheat would decrease and the equilibrium price of wheat would increase.
Of the following industries, which are perfectly competitive? For those that are not perfectly competitive, explain why
a. Restaurants b. Corn c. College education d. Local radio and television
When the economy is initially at full employment: a. contractionary monetary policy can result in increased real output, but only in the short run
b. contractionary monetary policy can result in increased real output in both the short run and long run. c. contractionary monetary policy can result in decreased real output, but only in the short run. d. contractionary monetary policy can result in decreased real output in both the short run and long run.