Suppose that Figure 7.4 shows an industry's market demand, its marginal revenue, and the production costs of a representative firm. If the industry was perfectly competitive, a representative firm's profit would be:
A. $1,250.
B. $450.
C. $250.
D. There is not sufficient information.
Answer: D
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When the government cuts the income tax rate, the real wage rate paid by employers ________ and the real wage rate received by workers ________ and potential GDP ________
A) increases; increases; increases B) decreases; decreases; increases C) increases; decreases; increases D) decreases; increases; decreases E) decreases; increases; increases
Since 1980, the share of temporary workers in total U.S. employment has ________
A) declined B) increased C) remained essentially unchanged D) been impossible to determine
Which of the following statements about taxes and government spending is correct?
A. Despite the overall progressive tax system, government expenditures disproportionately favor the rich and result in a system that is slightly regressive. B. The progressive tax system is almost perfectly offset by regressive expenditures, making the overall system proportional. C. The regressive tax system is offset by expenditures directed toward lower-income households, making the overall system proportional. D. The overall system of taxes and spending is progressive, as over $1 trillion per year gets transferred from upper-income households to lower- and middle-income households.
In a "black market,"
A. suppliers take advantage of buyers. B. price is illegally below market price. C. only illegal goods and services are traded. D. illegal trading at market prices takes place.