If, in a closed economy with no Government sector, MPC = 0.625, then the value of the multiplier is
(a) 0.475.
(b) 0.375.
(c) 2.67.
(d) 2.97.
Ans: (c) 2.67.
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Refer to Figure 4-1. What is the total amount that Arnold is willing to pay for 4 burritos?
A) $1.00 B) $4.00 C) $7.00 D) $10.00
When an economist is asked a question like "why is unemployment higher for teenagers than for older workers?" the economist
a. is asked to explain the cause of an economic event. b. is asked to recommend a policy to improve economic outcomes. c. is asked as a policy adviser. d. does not have enough information to respond.
A tax imposed on the sellers of a good
a. raises both the price buyers pay and the net price received by sellers. b. raises the price buyers pay and lowers the net price received by sellers. c. lowers the price buyers pay and raises the net price received by sellers. d. lowers both the price buyers pay and the price received by sellers.
Which of the following is NOT a fiscal policy?
A. Lowering personal tax rates to influence labor supply B. Increasing the money supply to expand aggregate demand C. Offering subsidies to export firms D. Increasing tariffs to reduce imports