If the government institutes an investment tax credit and decreases income taxes,
a) real GDP falls, and the price level could rise, fall, or stay the same.
b) real GDP and the price level fall.
c) real GDP rises, and the price level could rise, fall, or stay the same.
d) real GDP and the price level rise.
Ans: d) real GDP and the price level rise.
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The public sector of the U.S. economy includes:
a. the federal, state, and local government. b. multinational corporations and the federal government. c. the Federal Reserve bank of the U.S. d. the judiciary and the federal government. e. households.
Assume a monopoly confronts the same costs and demand as a competitive industry. In this case, the monopolist produces
A. Less output and charges a lower price than the competitive industry. B. More output and charges a higher price than the competitive industry. C. The same output and charges the same price as the competitive industry. D. Less output and charges a higher price than the competitive industry.