In the expansion phase of the business cycle:
What will be an ideal response?
employment and output increase
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Consider two people, Sandy Smith, who earns $25,000 . and Gary Carver, who earns $50,000 . If the government has decided to tax everyone's first $25,000 at 20 percent and everyone's second $25,000 at 40 percent, then Gary pays:
a. $10,000 in taxes and Sandy pays $5,000 in taxes. b. $10,000 in taxes and Sandy pays $10,000 in taxes. c. $15,000 in taxes and Sandy pays $5,000 in taxes. d. $15,000 in taxes and Sandy pays $10,000 in taxes. e. $17,000 in taxes and Sandy pays $5,000 in taxes.
In the long run, a profit-maximizing monopolist
A. earns zero economic profit. B. produces the same amount as a perfectly competitive industry. C. receives a higher price for his output than a perfectly competitive firm. D. produces at the output level that minimizes his long-run average total cost.
The forward exchange market:
a. Handles transactions for individuals or companies who would like to reduce foreign exchange risk by locking in exchange rates now. b. Is a market with no default risk. c. Provides sufficient liquidity for any maturity and amount. d. All the above.
The supply curve for products that require skilled labor and a large amount of capital is usually_______
Fill in the blank(s) with the appropriate word(s).