An increase in taxes
a. reduces income by more than the total fall in consumption.
b. reduces income by the same amount as the total fall in consumption.
c. reduces income and consumption by the same amount as taxes fall.
d. reduces income by the amount of the initial fall in consumption.
B
Economics
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Suppose that the price elasticity of demand for a product is ?1 and that the price elasticity of supply is +1 . Assume also that the income elasticity of demand is +2 . Then an increase in income of 10% will raise equilibrium price by
a. 10%. b. 5%. c. 20%. d. an annual amount that cannot be determined.
Economics
Which of the following is not a basic tenet of economic liberalism?
a. self-interest b. free trade c. competition d. government regulation
Economics