Which of the following statements is true concerning income inequality?
A. Developed countries have greater income inequality than developing countries.
B. The free market produces an unequal distribution of income.
C. The government has no way to alter income inequality.
D. Income is equally distributed in poor countries.
Answer: B
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According to the textbook, the Fed's information is fairly imprecise in regards to all of these things except:
A. actual real GDP B. potential GDP C. size of output gaps D. speed of the effects of its actions
When real Gross Domestic Product (GDP) falls, which of the following will automatically occur?
A) an increase in income tax revenues B) a decrease in all tax rates C) a decrease in unemployment compensation expenditures D) a decrease in income tax revenues
The marginal approach to profit maximization means that a firm should produce until:
a. marginal revenue equals zero. b. marginal revenue equals marginal cost. c. marginal cost becomes negatively sloped. d. marginal revenue equals price. e. price equals average total cost.
Inflation doves lean in the direction of milder recessions and are more willing to tolerate higher inflation
a. True b. False