The reason that the multiplier is smaller if there are variable taxes is that
a. taxes add to government spending, which increases income.
b. people get angry about taxes and decide to work less.
c. tax increases shift the expenditure line upward.
d. part of an increase in income is taken away in taxes.
d
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Which of the following is likely to happen if the Fed conducts a contractionary monetary policy?
A) Labor demand will increase. B) The nominal interest rate will decrease. C) The stock of money in the economy will decrease. D) Banks will make more loans.
If the price elasticity of demand equals 1.0, then as the price falls, the
A) quantity demanded decreases. B) total revenue falls. C) quantity demanded does not change. D) total revenue does not change.
Refer to Figure 2-8. Suppose Vidalia is currently producing 20 dozen orchids per period. How many roses is it also producing, assuming that resources are fully utilized?
A) 30 dozen roses B) 50 dozen roses C) 100 dozen roses D) 150 dozen roses
A business enterprise in which employees must belong to the union before they can be hired is
A) a closed shop. B) a union shop. C) a jurisdictional dispute. D) an industrial union.