Suppose the president is successful in passing a $10 billion tax increase. Assume that taxes are fixed, the economy is closed, and the marginal propensity to consume is 0.8. What happens to equilibrium GDP?
A) There is a $50 billion increase in equilibrium GDP.
B) There is a $40 billion increase in equilibrium GDP.
C) There is a $40 billion decrease in equilibrium GDP.
D) There is a $50 billion decrease in equilibrium GDP.
C
Economics
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A) it raises the barriers to entry. B) the quantity demanded increases. C) the quantity demanded remains the same. D) the quantity demanded decreases.
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If the Fed increases the money supply and people fully anticipate this change, they will immediately incorporate the disinflationary impact of the Fed's policies into their current wage and price decisions
a. True b. False Indicate whether the statement is true or false
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