Questions from General Economics


Q: Between January 2012 and January 2019, U.S. employment

Between January 2012 and January 2019, U.S. employment increased by 17.3 million workers, but the number of unemployed workers declined by only 6.3 million. How are these numbers consistent with each...

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Q: Let’s consider the effects of inflation in an economy composed of only

Let’s consider the effects of inflation in an economy composed of only two people: Bob, a bean farmer, and Rita, a rice farmer. Bob and Rita both always consume equal amounts of rice and beans. In 201...

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Q: The Tax Reform Act of 1986 eliminated the deductibility of interest payments

The Tax Reform Act of 1986 eliminated the deductibility of interest payments on consumer debt (mostly credit cards and auto loans) but maintained the deductibility of interest payments on mortgages an...

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Q: Assuming a tax rate of 40 percent, compute the before-

Assuming a tax rate of 40 percent, compute the before-tax real interest rate and the after-tax real interest rate for each of the following cases. a. The nominal interest rate is 10 percent, and the i...

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Q: A case study in the chapter analyzed purchasing power parity using the

A case study in the chapter analyzed purchasing power parity using the prices of Big Macs in several countries. Here are data for a few more countries: a. For each country, compute the predicted excha...

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Q: Purchasing-power parity holds between the nations of Ectenia and Wiknam

Purchasing-power parity holds between the nations of Ectenia and Wiknam, where the only commodity is Spam. a. In 2020, a can of Spam costs 4 dollars in Ectenia and 24 pesos in Wiknam. What is the exch...

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Q: Explain whether each of the following events increases, decreases, or

Explain whether each of the following events increases, decreases, or has no effect on long-run aggregate supply. a. The United States experiences a wave of immigration. b. Congress raises the minimum...

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Q: Give two arguments why wealthy taxpayers should pay more taxes than poor

Give two arguments why wealthy taxpayers should pay more taxes than poor taxpayers.

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Q: What is the marginal tax rate on a lump-sum tax

What is the marginal tax rate on a lump-sum tax? How is this related to the efficiency of the tax?

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Q: What is the relationship between a firm’s total revenue, total cost

What is the relationship between a firm’s total revenue, total cost, and profit?

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