An example of a regressive tax is the
A. personal income tax.
B. corporate income tax.
C. Social Security tax.
D. state inheritance tax.
Answer: C
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The shares of the economic value of a particular transaction that accrues to the seller and the buyer depend on:
a. the buyer's opportunity cost. b. the relative bargaining powers of the two parties. c. the cost of production incurred by the seller while producing the good. d. the lobbying techniques adopted by the two parties.
Industrial policy is an effort by a government to:
A. regulate prices in particular industries. B. identify the most profitable industries in the world, and adopt them in their country. C. favor some industries over others. D. control markets that are industrial.
In developing prospect theory, which of the following did behavioral economists not discover about people's reaction to goods and bads?
A. People feel equivalent losses and gains in equal measure, supporting the assumption that consumers behave rationally. B. People are generally loss averse, feeling losses more intensely than gains. C. People judge good and bad outcomes relative to the status quo. D. People experience both diminishing marginal utility from gains and diminishing marginal disutility from losses.
Which of the following is NOT a positive statement?
A) The unemployment rate is 5.8 percent. B) The inflation rate for 2002 was 2.3 percent. C) The national debt is too high. D) The federal government budget for 2004 is $2.2 trillion.