In the Romer model, as more labor is devoted to research and development there is ________
A) an immediate increase in output per capita and a permanent increase in output per capita
B) an immediate decrease in output per capita and a permanent increase in output per capita
C) an immediate increase in output per capita and a permanent decrease in output per capita
D) an immediate decrease in output per capita and a permanent decrease in output per capita
B
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According to classical theory, any changes in aggregate demand will
A) have no affect on prices or real Gross Domestic Product (GDP). B) lead to changes in both real Gross Domestic Product (GDP) and the price level. C) lead to changes in the price level. D) lead to changes in real Gross Domestic Product (GDP), but not in the price level.
The nominal tax rate is
A. Taxes paid divided by total economic income. B. Equal to the marginal tax rate. C. Taxes paid divided by taxable income. D. Lower than the effective tax rate.