An increase in the excise tax on cigarettes raises the price of cigarettes by shifting the:
A. supply curve for cigarettes rightward.
B. demand curve for cigarettes rightward.
C. supply curve for cigarettes leftward.
D. demand curve for cigarettes leftward.
Answer: C
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Often politicians assert that a price, such as the price of gasoline or the rent for an apartment, is too high and that it is unfair for these prices to be so high
If these products are traded in competitive markets, what fairness rule are politicians using? Why?
The lower the discount rate relative to the federal funds rate, the more likely a commercial bank will borrow from
A) another commercial bank instead of the Fed. B) the Fed instead of another commercial bank. C) the U.S. Treasury instead of either the Fed or another commercial bank. D) the public.
The fact that people sometimes regret having made a decision with perfectly predictable consequences:
A. cannot be explained by traditional economic models. B. suggests that people like to be unhappy. C. is a core assumption upon which traditional economic models are built. D. is a natural prediction of many traditional economic models.
If the MPC is 0.8, then the multiplier is 0.2.
Answer the following statement true (T) or false (F)