People ________ their labor supply in response to a temporary decrease in government purchases because
A) increase; current or future taxes will decrease, making them financially better off.
B) decrease; current or future taxes will decrease, making them financially better off.
C) decrease; current or future taxes will increase, making them financially worse off.
D) increase; current or future taxes will increase, making them financially worse off.
A
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The Monetarist model expands the Keynesian model by proposing that
A) decreases in the quantity of money lead to higher interest rates. B) the government should lower taxes promote economic growth. C) decreases in tax rates generate higher consumption. D) decreases in the growth rate of the quantity of money trigger expansions by controlling inflation. E) markets should be left alone to determine the optimal outcome.
An increase in demand for French fries will cause equilibrium wage rates:
A. and quantities of potato workers hired to rise. B. and quantities of potato workers hired to fall. C. to rise and quantities of potato workers hired to fall. D. to fall and quantities of potato workers hired to rise.