If the government repeals an investment tax credit and increases income taxes,
a. real GDP rises, and the price level could rise, fall, or stay the same.
b. real GDP falls, and the price level could rise, fall, or stay the same.
c. real GDP and the price level rise.
d. real GDP and the price level fall.
d
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Which of the following is necessary for allocative efficiency to be achieved?
A) Marginal benefit must be maximized. B) Marginal cost must be minimized. C) Marginal benefit must equal marginal cost. D) The difference between marginal benefit and marginal cost must be maximized. E) Production must be at a point inside the production possibilities frontier.
Convergence means that
A) if poor countries grow fast, then fast growing countries are poor. B) all countries grow at the same rate. C) all countries tend towards the same per capita income. D) the savings rate is positively related to per capita income.