please answer them all, thank you

1.

Some economists advocate a change from an income tax to a consumption?tax, such as a national sales tax. A sales tax makes consumption more expensive and so encourages households to save.

In the short?run, such a?change, all other things being?equal, will cause current consumption to ? ?decrease/increase?

and current saving to ?(decrease/increase)

.

A?longer-term impact will see capital formation ?(unaffected/accelerate/decelerate)

and a ?(higher than otherwise/lower than otherwise)

future GDP.

2.(increase/decreaseot change). (right/left). (both increase/both decrease)

[Related to the Solved Problem in this section] The graph to the right shows the marginal product of capital and the user cost of capital. Assume that the economy is currently at point A, with the capital stock equal to K 1* . Increases in the money supply when the interest rate is near 0% have the effect of lowering real interest rates but not nominal interest rates. Using the line drawing tool, show in the graph how asset purchase programs, such as those the Fed implemented in 2009-2011. would affect the user cost of capital, all other things being equal. Properly label any lines that you draw. Carefully follow the instructions above, and only draw the required object. Given the change shown in your graph, it can be deduced that in the short run, the desired capital stock and the level of investment will E . Returning to the original graph (i.e., ignoring the line drawn representing asset purchase programs), now suppose that there is an improvement in technology that makes capital more productive. A revision of the graph to reect this event would show the MPKe curve shifting to the E. In the short run, this productivity increase will cause investment and the capital stock to W . Dollars per unit of capital uc1 MPK? Capital stock, K