According to supply-side economics, when operating in the upper portion of the Laffer curve, tax cuts result in
A. interest rate increases.
B. productivity decreases.
C. income decreases.
D. tax revenue increases.
D. tax revenue increases.
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All of the following can create a bias in the CPI EXCEPT the
A) new goods bias. B) outlet substitution bias. C) commodity substitution bias. D) GDP price index bias. E) quality change bias.
Refer to Table 10-5, which lists the values of Harry Taber's marginal utility and marginal utility per dollar for Italian submarine (sub) sandwiches and tacos. Assume that the price of a sub sandwich is $4 and the price of a taco is $2
When Harry's income is $14, he buys two Italian sub sandwiches and three tacos. The last column lists the values of the marginal utility per dollar for tacos when the price of a taco decreases to $1. Complete this statement: As a result of the change in price A) Harry's purchasing power has increased. He will reduce his consumption of tacos so he can buy one more sub. This is an example of the substitution effect of a price change. B) Harry's purchasing power has increased. Harry buys fewer tacos. This is an example of the substitution effect of a price change C) Harry's purchasing power has increased. If tacos are a normal good for Harry he will buy fewer tacos. This is an example of the income effect of a price change. D) Harry's purchasing power has increased. If tacos are a normal good for Harry he will buy more tacos. This is an example of the income effect of a price change.
If full employment GDP is $500 billion greater than equilibrium GDP and there is a deflationary gap of $100 billion, how much is the multiplier?
What will be an ideal response?
What would happen to the planned investment function if business taxes were increased?
A) It would shift to the right. B) It would shift to the left. C) It would shift upward. D) There would be no change.