If the economy is experiencing an inflationary gap, classical economists argue that the Federal Reserve should lower interest rates

The elasticity of demand for employees is -0.50. It is also estimated that the existing minimum wage (price floor) has increased the raise the wage by 25% above equilibrium wage. How much would the employment change if the price floor was eliminated?

A) Employment would decrease by 12.5%. B) Employment would increase by 12.5%. C) Employment would decrease by 25%. D) Employment would increase by 25%.

If a flat tax plan allowed individuals to deduct a standard allowance of $20,000 and the flat tax rate was 20 percent, an individual earning $100,000 would pay an average tax rate of 20%

a. True b. False Indicate whether the statement is true or false