2.Increases in labor productivity from improved technology

a)increase the long run supply of labor

b)reduce the demand for labor

c)reduce real wages

d)induce firms to substitute capital for labor

e)have no long run effect on total hours worked

2.The marginal propensity to consume is

a)consumption divided by disposable income

b)national income divided by consumption

c)the change in national income caused by a $1 change in consumption

d)the change in consumption caused by a $1 change in disposable income

e)the percentage increase in consumption caused by a 1% decrease in savings

2.When depositors transfer funds from savings accounts to checking accounts,

a)M2 falls and M1 rises, while M3 remains constant

b)M1 rises while M2 and M3 remain constant

c)Both M1 and M2 increase, while M3 falls

d)M3 falls while M1 and M2 remain constant

e)M1 falls, M3 rises, and M2 remains constant

2.Targeting interest rates and targeting the money supply are equivalent if

a)money demand is stable

b)banks hold no excess reserves

c)exchange rates are fixed

d)central banks practice inflation targeting

e)consumers exhibit rational expectations

2.According to the Laffer Curve

a)Tax revenue always increases as tax rates rise

b)Tax revenue always falls as tax rates rise

c)Tax revenue initially rises with the tax rate but when tax rates get too high revenue begins to fall

d)Tax revenue initially falls with the tax rate but when tax rates reach some optimal level revenue begins to rise

Can You explain the solutions?