The consumption function becomes steeper as the income tax rate decreases because a decrease in the income tax rate:
a. increases the disposable income available to the consumer.
b. decreases the disposable income available to the consumer.
c. increases the marginal propensity to save

When financial markets and institutions are not efficient in matching savers and borrowers,

A) interest rates fall, which discourages saving even further. B) interest rates fall, which discourages investment even further. C) resources are lost. D) investment rises.

Government re-training programs, such as those that train workers who have lost their jobs due to outdated skills, would best fight the problem of

a. frictional unemployment b. cyclical unemployment c. structural unemployment d. underemployment e. seasonal unemployment