Assume that taxes depend on income. The MPC is 0.8 and t is 0.2. The government spending multiplier is

All these factors can lead to economies of scale in production, except:

a. division of labor that helps in specialization. b. merger of two firms. c. hiring larger machines which are more efficient than the smaller ones. d. increase in overhead expenses. e. research and development.

The intended purpose of price floors is to ______.

a. help large farming corporations contribute more revenue to the local tax base b. allow domestic farmers to trade competitively against foreign markets c. create enough revenue for small-volume farmers to maintain a “decent” standard of living d. encourage farmers to grow only those products which will maximize surplus for consumers