If the central bank of a country increases the discount rate, a commercial bank would:
a. experience a decrease in its net worth
b. hold a higher level of reserves.
c. take more loans from the central bank.
d. make more loans with its increased loan assets.
b
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Double taxation refers to the negative feature of
a. all businesses in the United States b. sole proprietorships c. corporations d. the federal and state tax systems e. partnerships
If the government ________ taxes to pay for spending on infrastructure, the result will most likely be a(n) ________ in capital deepening.
A. increases; increase B. decreases; increase C. increases; decrease D. eliminates; elimination
Which of the following explains the relatively high growth rate of output in China since 1980?
A) accumulation of capital B) technological progress C) a transition from central planning to a market economy D) all of the above
The real-income effect is typically small because
A) the change in price of one particular item has little effect on total purchasing power. B) income has no relation to consumption. C) price changes tend to balance out over time. D) real-incomes are always rising.