Use the following graph for a competitive market to answer the question below.
Assume the government imposes a $3 tax on buyers, which results in a shift of the demand curve from D1 to D2. The amount of the tax revenue paid by the buyer is
A. $300.
B. $600.
C. $2100.
D. $900.
Answer: A
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Refer to the scenario above. Suppose besides consuming all the potatoes grown on his farm, Edwin buys 5 pounds of potatoes at $0.80 per pound. What is likely to happen in this case?
A) GDP will increase by $4. B) GDP will remain unchanged. C) GDP will decrease by $0.80. D) Trade surplus will increase by $4.
An increased federal budget deficit resulting from a recession can actually help stabilize an economy through transfer payments because an increased budget deficit will ________ transfer payments and thereby ________ the income of some households
A) increase; increase B) decrease; decrease C) increase; decrease D) decrease; increase
Households receive transfers from ________, and firms receive transfers from ________
A) firms; households B) government; government and households C) government; no one D) firms and government; government E) government; government
The Bank of North America, the Bank of New York, and the Massachusetts Bank were all banks started in the 1780s that are examples of
a. savings and loans b. asset based banks c. stock banks d. state-chartered banks e. intermediary clearinghouses