Exempting food purchases from sales tax is consistent with the ability-to-pay principle, although not necessarily consistent with vertical equity
Indicate whether the statement is true or false
TRUE
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From 1980 to 2000 the employment-to-population ratio generally ________ and from 2000 to 2014 the ratio generally ________
A) increased; decreased B) decreased; decreased C) increased; increased D) decreased; increased
Screening is the attempt by the uninformed side of the market to uncover the relevant but hidden characteristics of the informed party
a. True b. False
Explain why the price doesn't change when a market is in equilibrium
The trade deficit is the mirror image of the required capital inflows. So why worry about these capital inflows?
A. Trade deficits automatically cause larger budget deficits. B. Before long, the Germans, Japanese, and other foreigners will own the United States and will be dictating policy to the U.S. government. C. These capital inflows create debts on which interest and principal payments will have to be made in the future. D. During the period of trade deficits, personal consumption must be reduced to build up wealth to repay the debt created.