When Taxes Are Included in the Stylized DSGE Model, with Cobb-Douglas

question 84

Multiple Choice

When taxes are included in the stylized DSGE model, with Cobb-Douglas production, labor demand is given by:

• A) \(w = \bar { \ell } \cdot \frac { ( 1 - \tau ) w } { c }\)
• B) \(\Delta L = \bar { s } f ( K , L ) - \bar { n } L\)
• C) \(w = \pi ^ { e } + \bar { v } \tilde { Y } + \overline { \bar { a } }\)
• D) \(w = \bar { m } ( \pi - \bar { \pi } )\)
• E) \(w = ( 1 - \tau ) \cdot 2 / 3 \cdot \frac { \bar { A } K ^ { 1 / 3 } } { L ^ { 1 / 3 } }\)

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Definitions:

Confirmation Bias

The tendency to search for, interpret, favor, and recall information in a way that confirms one’s preexisting beliefs or hypotheses.

Person Perception

The process by which individuals form impressions of others and make judgments about their characteristics and intentions.

Implicit Personality Theory

The assumption that individuals make unconscious, automatic inferences about the personality traits of others.

Social Psychology

The scientific study of how individuals think, influence, and relate to each other within social contexts.