What does not enter into the present value calculation of a college degree?
A. the cost of books
B. lifetime wages of noncollege graduates
C. wages of college graduates
D. the cost of college tuition
E. the value of one's scholarships
Answer: B
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Increases in the minimum wage are intended to raise the incomes of low-income workers. Many economists favor a different policy to achieve this goal, a policy that avoids the deadweight losses that result from the minimum wage. What is this policy?
A) the Alternative Minimum Tax B) the earned income tax credit C) distribution of food stamps to low-income consumers D) distribution of vouchers that can be used for rent or mortgage payments
Which of the following is one of the functions of rental prices?
A) to redistribute income from landlords to renters B) to redistribute income from renters to landlords C) to signal to the local government when taxes on rental units should be increased D) to ration the use of existing housing for current consumers
Which of the following best explains why a monopolist's marginal revenue is less than the sale price? a. To sell more units, a monopolist must increase the price on all units sold
b. As a monopolist expands output, its average total cost declines. c. When a firm has a monopoly, consumers have no choice other than to pay the price set by the monopolist. d. When a monopolist reduces price in order to sell more units, it must lower the price of some units that could otherwise have been sold at a higher price.
The best example of a direct tax is a(n)
a. excise tax. b. liquor tax. c. sales tax. d. income tax.