There are two types of government expenditures
What will be an ideal response?
mandatory and discretionary
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When you see a mansion and think to yourself that it must be worth a million dollars, you are using money to perform which function?
A) medium of exchange B) unit of account C) store of value D) means of payment E) method of avoiding barter
The use of discretionary fiscal policy is hampered by i. difficulty of estimating the level of potential GDP. ii. lack of accuracy of economic forecasts. iii
the small impact tax cuts and increases in government expenditure have on aggregate demand. A) i only B) ii only C) iii only D) i and ii E) i, ii, and iii
The formula for the price elasticity of demand
A. relies on statistical data. B. is based fully on knowledge of the slope of the demand curve. C. in practice drops the sign and focuses on the magnitude. D. is valid only when the price of product increases.
Which of the following statements is most consistent with the benefits-received principle of taxation?
A. People with high incomes should pay more taxes than people with low incomes. B. A childless couple should not be required to pay taxes for the support of public schools. C. Prosperous corporations should pay substantial taxes even if they use few government goods and services. D. The best tax is the income tax.