In the early 1980s, many people found themselves unable to purchase new homes because of:
a. rising prices and interest rates.
b. rising prices and falling interest rates.
c. new government restrictions on mortgages for first-time buyers.
d. increases in income tax rates.
a. rising prices and interest rates.
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Starting from long-run equilibrium, a large decrease in government purchases will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; lower; potential B. expansionary; higher; potential C. recessionary; lower; potential D. recessionary; lower; lower
According to the law of diminishing utility, _____
a. the same tax rate should be applied to every dollar b. the rich people should have a lower tax rate as compared to poor people c. the rich people should have a higher tax rate as compared to poor people d. the total burden on the society from a tax will be less if proportional taxation is used e. the poorer people should not be taxed at all
Which of the following statements correctly defines the law of demand?
a. The lower the price of a commodity, the lower the quantity demanded of that commodity. b. As the price of a commodity increases, the quantity demanded of that commodity also increases. c. The lower the price of a commodity, the greater the quantity demanded of that commodity. d. The lower the price of a commodity, the greater the quantity supplied of that commodity. e. The quantity demanded of a particular good decreases with an increase in the price of a substitute good.
The present value analysis of the death penalty
A. shows that the death penalty is not cost effective in its punishment and economists almost universally reject it for that reason. B. shows that the death penalty is quite cost effective in its punishment, though for a variety of reasons, economists are split on the wisdom of the policy. C. shows that the death penalty is not cost effective in its punishment, though for a variety of reasons, economists are split on the wisdom of the policy. D. shows that the death penalty is quite cost effective in its punishment and economists almost universally embrace it for that reason.