The federal income tax _______________ compared to a state sales tax.
A. has a higher administrative burden
B. has a lower administrative burden
C. is less complex
D. is administered basically the same as
A. has a higher administrative burden
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Return to the ready-to-eat cereal example from the previous question. Now assume that there is only one kind of cereal, so the manufacturer cannot distinguish between types of consumer (adults vs. children, of which suppose there are equal numbers in the market). What is the optimal menu of cereal boxes?
a. a 3 ounce box (which adults will buy) sold for 48 cents; a 4 ounce box (which children will buy) sold for $1.12. b. a 3 ounce box (which adults will buy) sold for 48 cents; a 4 ounce box (which children will buy) sold for 64 cents. c. a 2 ounce box (which adults will buy) sold for 36 cents; a 4 ounce box (which children will buy) sold for 76 cents. d. No menu; the manufacturer is better off just selling a 5 ounce box for $1.12, which is only purchased by children.
Utility is most closely defined as _____
a. the purchasing power of individuals b. welfare maximization c. a medium of exchange d. satisfaction e. an opportunity cost
Higher rates of anticipated inflation would tend to:
a. increase velocity and decrease nominal GDP. b. increase velocity and increase nominal GDP. c. decrease velocity and decrease nominal GDP. d. decrease velocity and increase nominal GDP.
Refer to the below graph of a hypothetical market for health care. If there was not health insurance, the equilibrium price and quantity of health care would be:
A. $20 and 600 units
B. $40 and 450 units
C. $60 and 300 units
D. $80 and 450 units