If New England had a Gini coefficient of 0.32 and the Middle Colonies had a Gini coefficient of 0.65, which of the following would be most accurate?
a. The Middle Colonies would have a higher per capita income.
b. The Middle Colonies would have a lower per capita income.
c. The Middle Colonies would have greater income inequality.
d. The Middle Colonies' income was growing faster.
c. The Middle Colonies would have greater income inequality. (Gini coefficient is a measure of income inequality. The higher it is, the more unequal the income.)
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The individual firm that hires labor under competitive conditions faces a labor supply curve that
A. slopes upward to the right. B. slopes downward to the right. C. is vertical, because workers need a job at any wage. D. is horizontal, because individual firms have no control over wages.
The proper short-run goal of macroeconomic policymakers is to
A) amplify the business cycle. B) dampen the business cycle. C) promote high economic growth. D) maintain low economic growth.
Two plausible hypotheses to explain the productivity slowdown are
A) measurement problems and adjustments to new technologies. B) large government budget deficits and large balance of trade deficits. C) globalization of capital markets and reductions in tariffs. D) adjustments to new technologies and failures in the educational system.
The government decides to increase its expenditures by $250. The multiplier in this economy is 4 and the tax rate is 22 percent. The net effect of this expansionary fiscal policy is to:
A. increase the budget deficit by $220. B. decrease the budget deficit by $220. C. decrease the budget deficit by $30. D. increase the budget deficit by $30.