The average tax rate is:
A. equal to the marginal tax rate if the tax is progressive.
B. the total tax rate minus the marginal tax rate.
C. the ratio of total taxes paid to total taxable income.
D. the tax rate that applies to incremental dollars of income.
Answer: C
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If we know that the slope of the consumption function is 0.6, then we know that if real disposable income increased by $1,000 billion, real consumption spending would
a. increase by $60 billion b. increase by $1,000 billion c. increase by $600 billion d. increase by $6,000 billion e. decrease by $6 billion
National income is
a. personal income of individuals minus the taxes they pay. b. gross national product minus depreciation. c. employee compensation, self-employment income, interest, rents, plus corporate profits. d. consumption, investment, government expenditures, and net exports.
A trade surplus results when the world supply curve is below the domestic economy's price level.
Answer the following statement true (T) or false (F)
The short-run aggregate supply curve in modern Keynesian analysis is
A) downward sloping. B) horizontal. C) vertical. D) upward sloping.