Discuss the thought process of the owners of a new business with regard to property taxes when deciding where to locate. Will they always locate where property taxes are lowest? Why or why not?
What will be an ideal response?
When deciding where to locate a new business, business owners typically have their choice of several sites and thus can choose among various locations. While high property taxes create a disincentive to improve upon property, property taxes are used to provide government services. Thus businesses are concerned with whether the property tax covers the value of the services the business will receive from government. In other words, they will not always locate where property taxes are the lowest. They will locate in communities that have the optimal mix of public sector output at the right property tax "price."
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If Y = $200 billion, c = 0.75, autonomous consumption = $10 billion, and T = $20 billion, induced saving is
A) $25 billion. B) $50 billion. C) $75 billion. D) $150 billion.
Any reserves beyond what is required are called
A) required reserves. B) excess reserves. C) secondary reserves. D) bank capital.
Which of the following most accurately describes the changes in GDP and unemployment between 1929 and 1933?
a. Real GDP changed little but the unemployment rate increased to about 50%. b. Real GDP increased by about 10% and the unemployment rate decreased to about 3%. c. Real GDP decreased by about 30% and the unemployment rate increased to about 25%. d. Both Real GDP and the unemployment dropped significantly.
Which of the following is an argument made in support of tariffs and import quotas?
a. protecting infant industries b. promoting national defense c. preventing product dumping d. all of the above