Review the discussion of pitfallsin economic thinking in this chapter. Then identify the fallacy, ormistake in thinking, in each of the following statements:a. Raising taxes always increases government revenues.b. Whenever there is a recession, imports decrease. Therefore, tostop a recession, we should increase imports.c. Raising the tariff on imported steel helps the U.S. steel industry.Therefore, the entire economy is helped.d. Gold sells for about $1,200 per ounce. Therefore, the U.S.government could sell all the gold in Fort Knox at $1,300 perounce to reduce the national debt.
Review the discussion of pitfallsin economic thinking in this chapter. Then identify the fallacy, ormistake in thinking, in each of the following statements:a. Raising taxes always increases government revenues.b. Whenever there is a recession, imports decrease. Therefore, tostop a recession, we should increase imports.c. Raising the tariff on imported steel helps the U.S. steel industry.Therefore, the entire economy is helped.d. Gold sells for about $1,200 per ounce. Therefore, the U.S.government could sell all the gold in Fort Knox at $1,300 perounce to reduce the national debt.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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| Review the discussion of pitfalls in economic thinking in this chapter. Then identify the fallacy, or mistake in thinking, in each of the following statements: a. Raising taxes always increases government revenues. b. Whenever there is a recession, imports decrease. Therefore, to stop a recession, we should increase imports. c. Raising the tariff on imported steel helps the U.S. steel industry. Therefore, the entire economy is helped. d. Gold sells for about $1,200 per ounce. Therefore, the U.S. government could sell all the gold in Fort Knox at $1,300 per ounce to reduce the national debt. |
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Follow-up Question
Gold sells for about $1,200 per ounce. Therefore, the U.S.
government could sell all the gold in Fort Knox at $1,300 per
ounce to reduce the national debt - is this a fallacy of composition or causation?
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by Bartleby ExpertFollow-up Question
Review the discussion of pitfalls
in economic thinking in this chapter. Then identify the fallacy, or
mistake in thinking, in each of the following statement: Gold sells for $400 per ounce. Therefore, the US governement could sell all of the gold in Fort Knox at $400 per ounce and eliminate the national debt.
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