Refer to the information provided in Figure 27.1 below to answer the question(s) that follow.
Figure 27.1Refer to Figure 27.1. Suppose the economy is at Point A, a decrease in taxes can cause a movement to Point
A. E.
B. B.
C. C.
D. D.
Answer: B
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Taxes levied on sellers and taxes levied on buyers are equivalent
a. True b. False Indicate whether the statement is true or false
One big difference between tariffs and quotas is that tariffs:
a. stimulate international trade while quotas inhibit it. b. generate tax revenues while quotas do not. c. hurt domestic producers while quotas help them. d. raise the price of a good while quotas lower it.
To decrease the money supply the Fed can:
A. Reduce the reserve requirement, raise the discount rate, or sell bonds. B. Raise the reserve requirement, raise the discount rate, or sell bonds. C. Raise the reserve requirement, reduce the discount rate, or buy bonds. D. Raise the reserve requirement, raise the discount rate, or buy bonds.
Refer to the above graph. Assume that before the Persian Gulf War, Iraq's production possibilities were represented by AB. Which line on the above graph would represent the change in Iraq's production possibilities after the war?
A. AB to AF B. AB to BE C. AB to EF D. AB to AD