Refer to the following figure when answering
Figure 15.1: The Labor Market
-Consider Figure 15.1, which is a representation of the labor market. If the state of Colorado decided to raise its sales tax rate, this would cause a shift from curve ________ because changes in taxes ________ in the stylized DSGE model.
A) $c \rightarrow d$; are reflected in the marginal produce of capital
B) $a \rightarrow b$; are identical to a change in income taxes
C) $a \rightarrow b$ are similar to a change in TFP
D) $d \rightarrow c$; negatively affected by TFP
E) None of these answers are correct.

Question

Refer to the following figure when answering  
Figure 15.1: The Labor Market 
-Consider Figure 15.1, which is a representation of the labor market. If the state of Colorado decided to raise its sales tax rate, this would cause a shift from curve ________ because changes in taxes ________ in the stylized DSGE model.
A) $c \rightarrow d$; are reflected in the marginal produce of capital 
B) $a \rightarrow b$; are identical to a change in income taxes 
C) $a \rightarrow b$ are similar to a change in TFP 
D) $d \rightarrow c$; negatively affected by TFP 
E) None of these answers are correct.

Quizplus · Accepted Answer

Changes in taxes are similar to a change in TFP in the stylized DSGE model.

Refer to the Following Figure When Answering Figure c→dc \rightarrow dc→d

Refer to the Following Figure When Answering
Figure $c \rightarrow d$