Which of the following tax changes would a supply-side economist be most likely to favor?
a. eliminating an investment tax credit
b. an increase in the capital gain tax
c. lower marginal income tax rates
d. an increase in the personal income tax rate for high-income individuals
c
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Factors that influenced planned investment spending include
A) real interest rates. B) financial frictions. C) emotional waves of optimism and pessimism. D) all of the above. E) A and C.
When does the degree of international capital mobility affect the qualitative change in the exchange rate (assume flexible exchange rates)?
a. The degree of international capital mobility is important when analyzing changes in monetary policy. b. The degree of international capital mobility is important when analyzing changes in fiscal policy. c. The degree of international capital mobility never affects the qualitative change in the exchange rate. d. The degree of international capital mobility affects the qualitative change in the exchange rate when analyzing changes in the monetary policy as well as changes in the fiscal policy.