If the reserve ratio is 15 percent, the money multiplier is
a. 7.7.
b. 6.7.
c. 5.7.
d. 15.
b
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How does an increase in the price level affect the aggregate planned expenditure curve and the aggregate demand curve?
What will be an ideal response?
Which of the following is a common characteristic of oligopolies?
a. Mutual interdependence regarding price, output, and advertising b. Market quantity demanded only large enough to support one firm c. Formal agreement to produce the same output at the same price d. Shared barriers to entry that limit the entry of other organizations
Vertical equity refers to a tax system in which individuals with higher incomes pay more in taxes than individuals with lower incomes
a. True b. False Indicate whether the statement is true or false
Figure 9.9 depicts a market for electricity. S1 is the supply curve without the external costs. S2 is the supply curve with the $T tax. Assume electricity production incurs external costs. If the government imposes a pollution tax of $T per mega watt:
A. the supply curve will shift to the right. B. the supply curve will shift to the left. C. demand curve will shift to the right. D. demand curve will shift to the left.