Suppose that in 2020 the average citizen's federal tax bill is $14,888 per person, and total federal spending is $13,997 per person. In 2020, the federal government will have
a. a per person budget surplus of $891.
b. a per person budget deficit of $891.
c. horizontal equity.
d. vertical equity.
Answer: b. a per person budget deficit of $891.
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An increase in the ____ interest rate will lead to an increase in the ____
a. nominal; demand for loanable funds b. nominal; supply of loanable funds c. real; quantity of loanable funds supplied d. real; quantity of loanable funds demanded
The Federal Reserve tends to increase the money supply each year
a. True b. False
An increase in the marginal propensity to consume would cause the IS curve to
A) make a parallel shift to the right. B) make a parallel shift to the left. C) rotate to become steeper from its vertical intercept. D) rotate to become flatter from its vertical intercept. E) rotate to become flatter from its horizontal intercept.
Economic efficiency is achieved when there is a market outcome in which the marginal benefit to consumers of the last unit produced is equal to its marginal cost of production and
A) economic surplus plus consumer surplus equals producer surplus. B) consumer surplus plus producer surplus is maximized. C) economic surplus is minimized. D) the difference between consumer surplus and producer surplus is maximized.