Which of the following is not a withdrawal (leakage) from the circular flow of income?
(a) Net Saving;
(b) Net Taxes;
(c) Expenditure on Imports;
(d) Expenditure on exports.
Answer: (d) Expenditure on exports.
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The deductibility of state and local taxes at the federal level _____
a. biases states against raising property taxes b. increase the amount of federal taxes paid c. reduces the marginal cost of paying state and local taxes d. raises the costs of paying state and local taxes
Poverty rates among the elderly are:
A. much lower than poverty rates among children. B. higher than the poverty rates among children. C. approximately the same as the poverty rates among children. D. rising more rapidly than the poverty rates among children.
For a monopoly to be a natural monopoly,
A. there must be constant returns to scale. B. the long-run average cost curve must continue to increase until it hits the market demand curve. C. economies of scale must be realized at a scale that is small relative to the market. D. economies of scale must be realized at a scale that is close to total demand in the market.
In Figure 15.3, the Fed can change the equilibrium interest rate from 2 percent to 6 percent by
A. Increasing the amount of coins in circulation. B. Decreasing the reserve requirement. C. Raising the discount rate. D. Buying bonds in the open market.