A tax cut initially
A) increases consumption expenditure by an amount greater than the tax cut.
B) increases consumption expenditure by an amount equal to the tax cut.
C) increases consumption expenditure by an amount that is less than the value of the tax cut.
D) has no effect on consumption expenditure.
E) reduces consumption expenditure by an amount that is less than the value of the tax cut.
C
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Refer to the production possibilities frontier figure above. Which of the following movements requires the largest opportunity cost, in terms of good X forgone, per extra unit of good Y?
A) from point e to point d B) from point d to point c C) from point c to point b D) from point b to point a
When you have diminishing marginal returns to labor
A) variable costs remain constant as more output is produced. B) variable costs fall as more output is produced. C) variable costs rise as more output is produced. D) fixed costs rise as more output is produced because you have to buy more equipment to compensate.