Which of the following would increase the size of the government purchases multiplier?
A) an increase in the quantity of imports purchased by households from an increase in income
B) a decrease in the amount saved by households from an increase in income
C) an increase in the tax rate
D) a decrease in the amount of consumption spending by households from an increase in income
B
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Industries in which firms have high fixed costs and low marginal costs are likely to have a:
A. large number of small firms. B. large number of large firms. C. small number of small firms. D. small number of large firms.
If the government ________ taxes to pay for spending on infrastructure, the result will most likely be a(n) ________ in capital deepening
A) decreases; increase B) increases; increase C) increases; decrease D) eliminates; elimination
Short-run equilibrium occurs at the intersection of
A) the SAS and AD curves. B) the SAS, LAS, and AD curves. C) the SAS and LAS curves. D) the LAS and AD curves.
When the marginal revenue product of an input is less than its price, the
A. producer should expand the use of that input. B. price of the input will automatically rise in a free market. C. producer should reduce the use of that input. D. marginal physical product of that input must be below its average physical product.