An economy with nominal tax rates significantly higher than effective tax rates has
A. A regressive tax system.
B. Loopholes in the tax code.
C. A progressive tax system.
D. Large in-kind benefits.
Answer: B
You might also like to view...
In the above figure, suppose the economy is initially on the demand for money curve MD1. What is the effect of a fall in the nominal interest rate?
A) The demand for money curve would shift rightward to MD2. B) The demand for money curve would shift leftward to MD0. C) There would be a movement upward along the demand for money curve MD1. D) There would be a movement downward along the demand for money curve MD1.
A change in labor productivity shifts the __________ curve and a change in the exchange rate shifts the __________ curve
A) SRAS; SRAS B) AD; AD C) SRAS; AD D) AD; SRAS E) none of the above
Who said "The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed, the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually slaves of some defunct economist."
A. Adam Smith B. Karl Marx C. John Maynard Keynes D. John Stuart Mill
What is the meaning of the phrase "dilemma of regulation"?
A. Natural monopolies achieve economies of scale but charge high prices when there is no government regulation; government regulation reduces prices but results in diseconomies of scale. B. The competitive price achieves allocative efficiency but may produce economic losses; the normal profit price yields a normal profit but may not be allocatively efficient. C. The normal profit price achieves allocative efficiency but may produce economic losses; the competitive price yields an economic profit but may not be allocatively efficient. D. Natural monopolies are profitable but only if the government permits price discrimination; government regulation to restrict price discrimination reduces monopoly prices, but the regulation also reduces monopoly output.