The Laffer curve indicates that
a. when tax rates are low, a decrease in tax rates is likely to increase tax revenues.
b. when tax rates are high, an increase in tax rates is likely to a decrease in tax revenues.
c. tax revenue will always increase when tax rates are increased.
d. tax revenue will always decrease when tax rates are lowered.
B
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Use the following graph to answer the next question.
If this economy was an open economy without a government sector, the level of real GDP would be
A. $300 billion. B. $200 billion. C. $100 billion. D. $400 billion.
Many economists believe that tax cuts increase incentives to work and invest but current U.S. tax levels do not appear to be on the downward side of the Laffer curve
a. True b. False Indicate whether the statement is true or false
Assume that the central bank lowers the discount to increase the nation's monetary base. If the nation has highly mobile international capital markets and a fixed exchange rate system, what happens to the quantity of real loanable funds per time period and net nonreserve international borrowing/lending balancein the context of the Three-Sector-Model? State your answer after the macroeconomic
system returns to complete equilibrium. a. The quantity of real loanable funds per time period remains the same and net nonreserve international borrowing/lending balance becomes more negative (or less positive). b. The quantity of real loanable funds per time period rises and net nonreserve international borrowing/lending balance becomes more negative (or less positive). c. The quantity of real loanable funds per time period falls and net nonreserve international borrowing/lending balance becomes more positive (or less negative). d. The quantity of real loanable funds per time period and net nonreserve international borrowing/lending balanceremain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.
Economic games can be used to analyze decisions around which of the following situations?
A. Environmental protection B. War C. Business D. All of these situations.