One major tax loophole intended to help state & local governments raise funds is
A. fiscal federalism.
B. tax exempt municipal bond interest.
C. tax deductible mortgage interest.
D. tax credits for solar panels.
Answer: B
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The free-rider problem arises if goods are
A. nonrivalrous in consumption. B. rivalrous in consumption. C. nonexcludable. D. excludable. E. a and d
A Treasury expenditure financed through borrowing from the Federal Reserve will cause the money supply
A) and bank reserves to rise by an equal amount. B) and bank reserves to fall by an equal amount. C) to rise but bank reserves to rise by a greater amount. D) to rise by a greater amount than the rise in bank reserves.
Suppose the economy is initially operating at full employment. A reduction in the size of the budget deficit will cause which of the following in the short run?
A) a recessionary gap. B) an increase the price level and a reduction in real GDP. C) an increase in the price level with no change in real GDP. D) an increase in real GDP and an increase in the price level.
The natural rate of unemployment has increased in the United States and Europe over the last twenty years. What are things that could account for this?
What will be an ideal response?