The marginal income tax rate is a person's tax burden as a percentage of total income.
Answer the following statement true (T) or false (F)
False
The marginal income tax rate is the tax rate that applies to an additional dollar of income earned.
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According to the "self-correcting mechanism" in the AD-AS framework, ________
A) the aggregate demand curve shifts up or down as needed to bring the economy to full employment B) the inflation rate changes as needed to move the economy along the short-run aggregate supply curve until output is at potential output C) the long-run aggregate supply curve shifts until it intersects both the aggregate demand and short-run aggregate supply curves at a single point D) inflation and expected inflation are unaffected by deviations of output from potential output E) none of the above
A special license is required to operate a taxi in many cities. The number of licenses is restricted. More drivers want licenses than are issued. This describes a non-perfectly competitive market because
A) taxi services are very different. B) firms cannot freely enter and exit the market. C) transaction costs are high. D) the government generates revenue from the licenses.
Suppose the demand for Pepsi is qp = 50 - 2pp + 1pc. The firm faces a constant marginal cost of m, and denotes the price of Coke
Assuming Bertrand behavior, derive Pepsi's best-response function and explain how the firm changes price in response to changes in its own marginal cost and changes in Coke's price.
Which of the following would be counted in U.S. GDP?
a. the purchase of an old house b. the purchase of a new textbook c. the purchase of a $1,000 government savings bond d. washing your car in the driveway e. the purchase of 50 shares of IBM stock