Those who favor a passive approach to policy often argue that changes in prices and wages will shift the:
a. short-run aggregate supply curve before active policy shifts the aggregate demand curve
b. short-run aggregate supply curve only after active policy shifts the aggregate demand curve.
c. short-run aggregate supply curve more than active policy shifts the aggregate demand curve.
d. short-run aggregate supply curve less than active policy shifts the aggregate demand curve.
e. short-run aggregate supply curve in a direction opposite the shift in the aggregate demand curve
a
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In the above table, which plan is a flat-rate tax?
A) only plan A B) only plan B C) only plan C D) both plan A and plan C
One way to minimize the excess burden resulting from a specific tax is to:
a. tax only wealthy firms and individuals. b. spread the tax over many goods and services. c. tax goods for which either supply or demand is inelastic. d. tax luxury items such as yachts and sports cars.