Suppose that in some tax year you earned a nominal interest rate of 6 percent. During the time you held these funds inflation was 1 percent. You compute that you made a real after-tax interest rate of 3 percent. What was your tax rate?
a. 40 percent.
b. 33.3 percent.
c. 25 percent.
d. 50 percent.
b
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Consider an economy over the years 2008 and 2009. The output in the economy has remained constant over the two years but the prices of all goods and services have halved. In such a situation,
A) the real GDP of the economy stays the same over the two years. B) the nominal GDP of the economy remains the same over the two years. C) the real GDP of the economy increases over the two years. D) the nominal GDP of the economy increases over the two years.
A deposit outflow results in equal reductions in
A) loans and reserves. B) assets and liabilities. C) reserves and capital. D) assets and capital.
The "monopoly issue" is concerned with the fact that
(a) monopolies will "charge what the traffic will bear" in order to maximize their profits. (b) monopolies will attempt to increase their profits by discriminating among their customers and charge prices that they are willing to pay, instead of charging one price. (c) monopolies will be able to charge higher prices and earn higher rates of return than competitive firms. (d) all of the above apply.
Which of the following is a common characteristic of oligopolies?
a. Mutual interdependence regarding price, output, and advertising b. Market quantity demanded only large enough to support one firm c. Formal agreement to produce the same output at the same price d. Shared barriers to entry that limit the entry of other organizations