The Italian government collects a smaller amount of the taxes it is owed than the U.S. government. Other things being equal,
A. U.S. and Italian GDP should be equal.
B. U.S. GDP may be higher than Italian GDP.
C. U.S. GDP should be lower than Italian GDP.
D. U.S. residents are better off than Italian residents.
Answer: B
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If the required reserve ratio is a uniform 25 percent on all deposits, the money multiplier will be
The inflation rate is defined as the
a. price level in an economy. b. change in the price level from one period to the next. c. percentage change in the price level from the previous period. d. price level minus the price level from the previous period.
Which set of changes will definitely shift the aggregate demand (AD) curve to the right?
A) Business taxes decline and foreign real national income rises. B) Businesses become pessimistic about future sales and the U.S. dollar depreciates. C) Wealth increases and individuals expect higher (future) incomes. D) a and b E) a and c
Exhibit 13-3 A monopolist
In Exhibit 13-3, if this industry is regulated and the regulatory commission sets price equal to marginal cost, then:
A. this firm would earn excess profit. B. price would equal ATC. C. the firm would suffer losses. D. revenue would just be sufficient to cover costs.