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1. Which of the following is considered a fixed tax and which a variable tax?
a. The gasoline tax
b. The corporate income tax c. The estate tax
d. The payroll tax
2. In a certain economy, the multiplier for government purchases is 2 and the multiplier for changes in fixed taxes is 1.5. The government then proposes to raise both spending and taxes by $100 billion. What should happen to equilibrium GDP on the demand side?
The Charlotte Bobcats, a professional basketball team, has been offered the opportunity to purchase the contract of an aging superstar basketball player from another team. The general manager of the Bobcats wants to analyze the offer as a capital ..
Describe the relationship between unemployment and real and nominal wages. Which is more important and why What effects would either an increase or decrease in unemployment have on wages
Dairy farm Industry a small producer of milk and cheese, has estimated the quantities of milk.
Illustrate what are the three recommendations you would make to him to improve the overall effectiveness of the economy.
The government imposes a fixed fee per year on each firm operating in a competitive market.
In addition to depending on disposable income, suppose household consumption were also a function of the interest rate. In particular, assume that households consume more (i.e., save less) when the interest rate falls. Assume prices are fixed in t..
Some economists did a study of market for economists in Britain. They discover that the quantity demanded was about 150 per year, and that the quantity supplied was about three hundred per year
Supply demand analysis to elucidate how the prices of untaxed consumption items can be affected by the retail sales tax even though they are not subject to taxation.
Given the high value of the Canadian dollar relative to the U.S. dollar, Canada should lower the value of the dollar and keep it at this lower level,
The city of Bookburg initially allows only one book store, which sells books at a price of $20 and an average cost of $11. Suppose the city eliminates its restrictions on book stores, allowing additional stores to enter the market. According to an..
Assume that the economic news is not good and businesses become pessimistic about the future. How would this change in attitude affect the investment demand curve and the impact on real GDP.
Suppose the following data about the demand for goods and services. All variables are in billions of dollars. Suppose that potential level of output is $12,000 billion. Use the above data to calculate the size of the output gap?
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