Horizontal equity holds that
A. those who benefit the most from government services should have the greatest voice in determining what gets produced.
B. those who benefit the most from government services should bear the higher tax burden.
C. those with equal ability to pay should bear unequal tax burdens.
D. those with equal ability to pay should bear equal tax burdens.
Answer: D
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The common factors that give rise to all principal-agent problems include the
a. unobservability of some manager-agent action b. presence of random disturbances in team production c. the greater number of agents relative to the number of principals d. a and b only e. none of the above
In terms of capabilities, education can be seen as:
A. contributing to better family planning. B. a factor that reduces income inequality in countries. C. a feature of more democratic regimes. D. something that requires a lot of funding, but produces very little return.
Economists face an obstacle that many other scientists do not face. What is that obstacle?
a. It is often difficult to formulate theories in economics. b. It is often impractical to perform experiments in economics. c. Economics cannot be addressed objectively; it must be addressed subjectively. d. The scientific method cannot be applied to the study of economics.
The Fed increases reserves if it conducts open market
a. purchases or auctions term credit. b. purchases but not if it auctions term credit c. sales or auctions term credit d. sales but not if it auctions term credit