Ricardian equivalence implies a tax multiplier of zero
a. True
b. False
A
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Which of the following factors will make the demand for a product relatively elastic?
A. The good is considered a necessity. B. There are few substitutes. C. The time interval considered is long. D. Purchases of the good require a small portion of consumers' budgets.
Kenneth Chay and Michael Greenstone examined the impact of reductions in air pollution since the passage of the Clean Air Act of 1970. Which of the following statements summarizes their findings?
A) In the two years following passage of the Act, fewer infants died than would have died if the Act had not been passed. B) The benefits of reducing the six main air pollutants in the two years following the Act greatly exceeded the costs. C) The marginal cost of reducing emissions of sulfur dioxide has increased over time as the marginal benefit of the reductions has increased. D) The marginal benefit of reductions in air pollution was less than the marginal cost.
One reason that supports nations having separate currency suggests that there are welfare gains from
A) currency competition. B) seignorage. C) capital mobility. D) debt reduction.
Which of the following explains why purchasing power parity may not hold perfectly in the long run?
A) Most countries have free markets with limited government regulation. B) Consumer preferences for goods and services across countries are very similar. C) Most countries do not impost trade barriers. D) Some goods and services produced in any country are not traded internationally.