A proponent of supply-side economics would advocate
a. reducing income taxes on saving.
b. reducing tax credits for research and development.
c. eliminating the depreciation allowance.
d. increasing the corporate income tax.
a
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When the ratio of domestic prices to foreign prices falls:
A) the real exchange rate depreciates only when the nominal exchange rate depreciates. B) the real exchange rate depreciates even when the nominal exchange rate is constant. C) the real exchange rate appreciates. D) the real exchange rate depreciates only when the nominal exchange rate appreciates.
Consider two individuals, Wendy and Jenny, who discount delayed utilities with a weight of 1/4 and 7/8, respectively. Consuming one hamburger gives both Wendy and Jenny benefits worth 16 utils instantly and has delayed costs of 20 utils
a) If the nearby hamburger shop is closed for a week, comment on whether both individuals will consume hamburgers after a week. b) If a new shop is opened nearby, and hamburgers are available for consumption today, comment on whether both individuals will consume hamburgers.