Consider a tax cut which affects not only consumer disposable income, but also afterminus−tax earnings from labor supplied to labor markets and from financial assets acquired through saving. in the long run we would expect this tax cut to a. increase the price level. b. increase both the price level and the level of real gdp. c. increase the level of real gdp. d. decrease both the price level and increase real gdp.

Suppose that a government that is skeptical of efforts to regulate prices charged by private companies is nevertheless concerned that an electric utility company is taking advantage of consumers with unfair pricing policies. which of the following policy options might most effectively enable the government to achieve its objectives in this situation? do nothing to all. turn the company into a public enterprise. use antitrust laws to increase competition. regulate the firm's pricing behavior.