Chat with AI
Macroeconomics 10th Edition by William McEachern
Edition 10ISBN: 978-1133188131Macroeconomics 10th Edition by William McEachern
Edition 10ISBN: 978-1133188131 Exercise 5
PITFALLS OF ECONOMIC ANALYSIS Review the discussion of pitfalls in economic thinking in this chapter. Then identify the fallacy, or mistake in thinking, in each of the following statements:
a. Raising taxes always increases government revenues.
b. Whenever there is a recession, imports decrease. Therefore, to stop a recession, we should increase imports.
c. Raising the tariff on imported steel helps the U.S. steel industry. Therefore, the entire economy is helped.
d. Gold sells for about $1,700 per ounce. Therefore, the U.S. government could sell all the gold in Fort Knox at $1,700 per ounce and reduce the national debt.
a. Raising taxes always increases government revenues.
b. Whenever there is a recession, imports decrease. Therefore, to stop a recession, we should increase imports.
c. Raising the tariff on imported steel helps the U.S. steel industry. Therefore, the entire economy is helped.
d. Gold sells for about $1,700 per ounce. Therefore, the U.S. government could sell all the gold in Fort Knox at $1,700 per ounce and reduce the national debt.
Explanation
Verified
Verified
a.High tax rate discourages taxpayers to...
Macroeconomics 10th Edition by William McEachern
Why don’t you like this exercise?
Other Minimum 8 character and maximum 255 character
Character 255
