If a new tax policy relatively raises the tax rate 2.5 percent but causes the output supplied to fall by 15 percent, the absolute value of the tax elasticity of supply is
A. 1.5.
B. 6.0.
C. 37.5.
D. 0.375.
Answer: B
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If the initial distribution of two goods between two people is Pareto optimal, which of the following statements is TRUE?
A) It is possible to reallocate the goods between the two people so as to increase the utility of both people. B) It is possible to reallocate the goods between the two people so as to increase the utility of one person without decreasing the utility of the other. C) It is possible to reallocate the goods between the two people so as to increase the utility of one person, but only at the expense of the other person. D) It is impossible to reallocate the goods between the two people so as to increase either person's utility. E) none of the above
When public saving falls by $2b and private saving falls by $1b in a closed economy,
a. investment falls by $1b. b. investment falls by $3b. c. investment increases by $1b. d. investment falls by $2b.
Output per person must be ________ output per worker.
A. greater than or equal to B. no more than half the size of C. equal to D. less than or equal to
The type of currency in circulation in the modern U.S. economy is almost entirely
A. commodity money. B. metallic money. C. fiat money. D. silver certificates.