Kimani sells life insurance and is considering buying a $50,000 Cadillac for business purposes (thus, the expense reduces her taxable income). If Kimani is in the 40 percent marginal tax bracket, how much after-tax income will she have to give up in order to enjoy the Cadillac?
a. $20,000
b. $30,000
c. $25,000
d. $70,000
B
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What can be expected to happen in a country that enacts trade barriers?
A) The rate of population growth will decrease. B) The rate of economic growth will decrease. C) The rate of immigration will increase. D) The rate of technological innovation will increase.
The Friedman Rule is optimal because
A) households would be able to buy more as prices decrease. B) the central bank has better control of the money supply. C) money is neutral. D) households are indifferent between holding bonds and money.
To derive the labor market demand curve, the labor demand curves for each firm in the output market of interest are summed
Indicate whether the statement is true or false
Fighting inflation by slowing the growth of aggregate demand is
A. endorsed by most politicians. B. a convenient way to reduce inflation. C. unpopular with politicians. D. always easily accepted by firms and workers.