Refer to the data. If a lump-sum tax (the same tax amount at each level of GDP) of $40 is imposed in this economy, the marginal propensity to consume is:
Answer the question on the basis of the following before-tax consumption schedule for a closed economy:
A. .8 before taxes and .6 after taxes.
B. .8 both before and after taxes.
C. .6 before taxes and .8 after taxes.
D. .8 before taxes and .4 after taxes.
B. .8 both before and after taxes.
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The above table gives the initial balance sheet for Mini Bank. If the bank's desired reserve ratio is 10 percent, it will make
A) more loans. B) fewer loans. C) no change in its lending. D) you cannot predict what the bank will do from this balance sheet without more information.
If = 4%, = 3%, and = 2%, then must equal:
What will be an ideal response?
A new domestic industry with potential economies of scale is called a(n):
A) potential business entrant. B) immature industry. C) infant industry. D) highly valued entrant.
Which statement is true about the perfect competitor?
A. Firms operate at peak efficiency in the short run. B. Economic profits are greater than accounting profits. C. Firms that survive must make a profit in the long run. D. The demand curve is perfectly elastic for each firm.