In 2010, the co-chairmen of President Obama's deficit reduction commission proposed curtailing or eliminating many tax deductions such as the one for mortgage interest. Economists who favor the proposal argue that it would (i) correct a misallocation of resources because too much of the economy's capital stock is tied up in residential housing and too little is invested in corporate capital. (ii)
cut both spending and taxes. (iii) encourage private philanthropy.
a. (i) only
b. (ii) only
c. (i) and (ii) only
d. (i), (ii), and (iii)
c
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As the amount of labor used in production increases, total product
a. increases at low levels of labor and decreases at high levels labor. b. increases at high levels of labor and decreases at low levels of labor. c. always increases. d. always decreases.
The law of demand says that the lower the price of a good, other things constant,
a. the smaller the demand for that good b. the larger the demand for that good c. the smaller the quantity demanded of that good d. the larger the quantity demanded of that good e. the smaller the real income of consumers and the lower the quantity demanded of that good
People are unemployed if they are over 16 and not working due to:
A. The inability to find a job even though they are looking. B. A two-week summer vacation. C. A strike. D. The lack of motivation to look for work.
If Suntrust Banks have demand deposits of $10 billion, actual reserves of $2 billion, and the reserve requirement is 18%, the bank's excess reserves are
A. $180 million. B. $200 million. C. $360 million. D. $400 million.