A payroll tax
A. Causes the net wage to increase.
B. Increases the nominal cost of labor.
C. Shifts the labor demand curve to the right.
D. Shifts the labor supply curve to the right.
Answer: B
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The Federal Reserve plays a larger role than Congress and the president in stabilizing the economy because
A) the Federal Reserve can more quickly change monetary policy than the president and the Congress can change fiscal policy. B) changes in interest rates have their full effect on the economy in a short period of time, whereas changes in government spending and taxes have their full effect over a long period of time. C) the Federal Reserve can immediately recognize when real GDP is below or above potential GDP. D) changes in interest rates have a considerably larger effect on the economy than changes in government purchases or taxes.
The aggregate demand curve slopes downward indicating that
a. an increase in the general price level will reduce the aggregate quantity of goods and services demanded. b. an increase in the general price level will increase the aggregate quantity of goods and services demanded. c. a change in the interest rate will alter the aggregate quantity of goods and services demanded. d. consumers substitute between domestic-made and foreign-made goods as their relative prices change.
The demand for gasoline will respond more to a change in price over a period of five weeks than over a period of five years
a. True b. False Indicate whether the statement is true or false
A firm's marginal cost is defined as
a. the ratio of total cost to total output. b. the ratio of total output to total cost. c. the additional cost of producing one more unit of output. d. the reciprocal of total average cost.