Which of the following observations is true?
a. Increase in taxes shifts the consumption schedule upward.
b. Tax reductions increase equilibrium GDP.
c. Taxes reduce total spending directly.
d. Taxes do not have a multiplier effect on equilibrium GDP.
b
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In order to ________ the long-run real interest rate, the Fed needs to ________
A) raise; raise the long-run inflation expectations B) raise; lower the long-run nominal interest rate C) lower; raise the long-run nominal interest rate D) lower; raise the long-run inflation expectations
A bank failure occurs when a bank
a. cannot call in its loans b. spends all of its reserves c. is unable to meet its depositors' requests to withdraw funds d. cannot make any more loans e. makes bad loans
With voluntary exchange,
a. both the buyer and seller will be made better off. b. the buyer will be made better off, while the seller will be made worse off. c. the seller will be made better off, while the buyer will be made worse off. d. both the buyer and the seller will be made worse off.
Which of the following government programs provides recipients with unrestricted cash payments?
a. The food stamp program b. Medicaid c. Temporary Assistance to Needy Families (TANF) d. Housing assistance programs