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5 Written questions

5 Matching questions

  1. Marginal Tax rate
  2. The Laffer Curve
  3. Consumption Goods
  4. Rational Economic Behavior
  5. Structural Unemployment
  1. a goods purchase by households for immediate satisfaction or to use up (ex. food, movies)
  2. b Unemployment because the skills needed for a job do not match those of the unemployed, or the unemployed do not live where the jobs are located
  3. c A graph showing total tax revenue as a function of the tax rate. Used by "supply-side" economists to support arguments for a tax cut or increase
  4. d tax rate that applies to the next dollar of taxable income, that increases as the amount of taxable income increases
  5. e The assumption that people act in a rational way and they want more at cheaper prices and less at higher. To act rationally is to act one way, to think rationally is to think logically. The assumption that humans make the best use of their resources

5 Multiple choice questions

  1. Unemployment that fluctuates with the business cycle, increasing during contractions and decreasing during expansions
  2. A sustained rise in the price level caused by a leftward shift of the aggregate supply curve
  3. Unemployment that occurs because job-seekers and employers need time to find each other
  4. Unemployment caused by seasonal changes in the demand for certain kinds of labor
  5. income tax deductions from spending money on tax-deductible expenses

5 True/False questions

  1. Bank Balance Sheettax rate that applies to the next dollar of taxable income, that increases as the amount of taxable income increases

          

  2. Ability to Pay Principletotal tax paid divided by total (taxable) income, as a percentage

          

  3. Fiscal DragThe interest rate that banks pay to the Fed when banks need to borrow from the Fed. This is known as a penalty for violating the required reserve ratio

          

  4. Annually Balanced BudgetBudget philosophy calling for budget deficits during recessions to be financed by budget surpluses during expansions

          

  5. Wealth of NationsA sustained decrease in the price level

          

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