Exhibit 11-8 Aggregate demand and supply curves
In Exhibit 11-8, supply-siders claimed that the shift from AS1 to AS2 would occur if the government:
A. increased tax rates and increased the amount of government regulation.
B. increased tax rates and decreased the amount of government regulation.
C. decreased tax rates and increased the amount of government regulation.
D. decreased tax rates and decreased the amount of government regulation.
Answer: D
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Refer to Figure 4-6. At the equilibrium price of P1, consumers are willing to buy Q1 pounds of granola. Is this an economically efficient quantity?
A) No, the marginal cost of the last unit (Q1 ) exceeds the marginal benefit of the last unit. B) No, the marginal benefit of the last unit (Q1 ) exceeds the marginal cost of that last unit. C) Yes, because P1 is the price where marginal benefit equals marginal cost. D) Yes, because marginal cost is zero at the price of P1.
A stock mutual fund is generally
A) less risky than buying individual stocks. B) more risky than buying individual stocks. C) just as risky as buying individual stocks. D) a way for the rich to avoid taxes.
According to Keynesian theory, a recessionary gap can be closed using expansionary fiscal policy
Indicate whether the statement is true or false
Figure 4-6
The revenue generated by the tax illustrated in is given by the area
a.
ACLH.
b.
BEKM.
c.
ACFG.
d.
0AGJ.