Positive economic questions
A. involve value judgments.
B. address what ought to happen.
C. are potentially testable.
D. cannot be tested.
C. are potentially testable.
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Nominal income is equal to real income if the CPI is less than 100
Indicate whether the statement is true or false
Corporate taxes are a direct tax.
Answer the following statement true (T) or false (F)
If it becomes more expensive for firms to hold excess capital and labor, the multiplier will
A. increase. B. remain unchanged. C. decrease. D. either increase or decrease depending on the value of the MPC.
The Ricardo-Barro effect says that a government budget deficit leads to
A) no change in the real interest rate. B) a lower real interest rate. C) an increase in the quantity of investment. D) a higher real interest rate. E) an increase in demand for loanable funds.