Unemployment compensation programs tend to increase the unemployment rate because:
a. they increase the opportunity cost of leisure
b. they provide benefits only to unemployed people under the age of 18.
c. they legally fix the minimum wage that has to be paid to labor.
d. they allow unemployed persons to become more selective in what job offer they accept.
e. they do not provide benefits to labor engaged in the manufacturing sectors of the economy.
d
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Suppose that the required reserve ratio is 10 percent and you withdraw $25,000 from Comerica Bank. What is the deposit multiplier? What is the total decrease in deposits in the banking system? What is the change in the money supply?
What will be an ideal response?
If lower-income households spend a greater share of their income on cigarettes than do higher-income households, then a tax that raises the price of cigarettes will
A) cause lower-income households to incur a greater loss of consumer surplus than that incurred by higher-income households. B) cause higher-income households to incur a greater loss of consumer surplus than that incurred by lower-income households. C) raise consumer surplus among higher-income households. D) cause consumer surplus to decline among smokers, but the relative impact cannot be determined from the given information.