Which of the following is the most likely cause of most recessions according to the Keynesian model?
a. a fall in productivity.
b. an increase in taxation and government spending.
c. a fall in expected profits.
d. a rise in the price of oil.
e. a fall in the money supply.
C
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What effect would a simplification of federal tax law have on the cost of hiring a tax accountant?
A) It would fall because tax accountants would have fewer valuable opportunities. B) It would rise because tax accountants would have to raise their prices to maintain their incomes. C) It would have no effect because only supply affects costs, not demand. D) It would have very little effect because most of the costs of becoming an accountant are sunk costs.
The above figure gives your budget line between CDs and magazines. If the price of a magazine increased, then the budget line
A) shifts outward and the slope does not change. B) rotates inward with no change in the horizontal intercept. C) rotates inward with no change in the vertical intercept. D) rotates outward with no change in the vertical axis.