Which of the following factors has the most quantitative importance on the oversimplified multiplier formula?
A. It ignores variable imports.
B. It ignores price-level changes.
C. It ignores income taxes.
D. All of these equally affect the oversimplified multiplier formula.
Answer: C
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Throughout the twentieth century, and especially since the mid-1960s:
A. the labor force participation rates of women increased dramatically. B. the labor force participation rates of women have decreased dramatically. C. the labor force participation rates of women slowly increased. D. the labor force participation rates of women fluctuated wildly.
What happens in the steady state to the capital—labor ratio, output per worker, and consumption per worker when each of the following events occur? You should assume that the steady-state capital—labor ratio is below the Golden Rule level
(a) Productivity falls. (b) Population growth falls. (c) The saving rate falls. (d) The depreciation rate falls.