Which of the following is an example of an automatic stabilizer?
A. Congress authorizes spending increases during a recession.
B. Congress increases the tax rate during an expansion.
C. More unemployment benefits are paid during a recession.
D. Welfare payments decrease during a recession.
Answer: C
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In an open economy, Y = C + I + G + NX. From this we may infer that ________
A) output is greater in an open economy than in a closed economy B) the condition for goods market equilibrium is that S = I + G + NX C) net exports can be zero only if the domestic real interest rate is equal to the world real interest rate D) if saving is greater than zero, NX cannot be zero E) none of the above
Find the dollar value of a per unit gasoline tax that would achieve the efficient solution, and calculate the resulting tax revenues generated to government.
As an economic consultant to the federal government, you recommend a market-based national policy response to global warming. In particular, you suggest using a pollution charge, which can be implemented as a gasoline tax. Based on your estimates, the marginal benefits and costs per gallon of gasoline are modeled as follows: MPB = 10 ? 0.7Q MEB = ? 0.05Q MSC = MPC = 1 + 0.15Q, where Q is in millions of gallons.
Which of the following environmental approaches is most appropriate when surveillance and enforcement is impractical?
A. Direct controls B. Emissions tax C. Volunteerism D. Tradable emission permits
A stronger dollar would be a good policy if the U.S. government wanted to:
A. increase U.S. imports and expand the U.S. economy. B. reduce U.S. imports and slow the U.S. economy. C. reduce U.S. exports and slow the U.S. economy. D. increase U.S. exports and expand the U.S. economy.