Exam 16: Supply-Side Policy: Short-Run Options

A basic contention of supply-side economists is that regulatory costs are now too ________ and cause AS to shift to the ________.

Which of the following theorists believe a decrease in marginal tax rates will increase the incentives to work and invest?

The misery index is the

Which of the following will definitely cause the value of the misery index to increase?

Refer to Figure 16.3.A shift from AS₁ to AS₂ could be caused by

Only a ________ shift of the ________ curve can reduce unemployment and inflation at the same time.

If the absolute value of the tax elasticity of supply is 0.8,a tax decrease of 10 percent will

Demand-side economists treat saving as a leakage from potential spending.

An increase in the misery index would definitely result from

If the absolute value of the tax elasticity of supply is 0.5,a tax increase of 10 percent will

Refer to Figure 16.3.A shift from AS₁ to AS₂ could be caused by

Refer to Figure 16.4.If the economy is initially in equilibrium at P₃ and Q₁,the appropriate policy to move the economy to an equilibrium at P₁ and Q₂ would be to

Choose the letter of the diagram in Figure 16.1 that Keynesians would use to illustrate the effects of stimulative fiscal policy on the economy.

A decrease in the marginal tax rates is likely to

A rightward shift in aggregate demand will cause an increase in the price level and no change in output if aggregate supply is

The Phillips curve shows

How can minimum wage laws,which are supposed to help workers,have a negative impact on producers and the economy?

Which of the following is most likely to cause the aggregate supply curve to shift to the right?

A rightward shift in aggregate demand will cause an increase in output and price level if aggregate supply is

An attempt to lower unemployment with demand-side stimulus policies will cause an increase in the price level,which is illustrated by