Refer to the information provided in Figure 7.4 below to answer the question(s) that follow. 
Figure 7.4Refer to Figure 7.4. The marginal product of the second worker is
A. 10.
B. 16.
C. 20.
D. 32.
Answer: C
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Situation 35-2 ? Dan and Ann live in the same community and both can participate in two activities, producing and stealing. Refer to Situation 35-2. Ann spends 8 hours of each day producing and 1 hour of each day stealing. It is probably the case for her that
A. at some point the MB/MC ratio for producing fell below the MB/MC ratio for stealing. B. her MB/MC ratio for producing was always greater than her MB/MC ratio for stealing. C. her MB/MC ratio for producing never changed, no matter how much or how little she produced. D. her MB/MC ratio for stealing never changed, no matter how much or how little she stole. E. There is not enough information to answer the question.
Taxing savings will cause people to save more.
A. True B. False C. Uncertain
The model of perfect competition can be fruitfully used to analyze markets that don't perfectly fit the description of this market type
a. True. b. False.
Which of the following statements is false?
A. At this time, there is not clear consensus on what the best tax base is. B. The double taxation of saving tends to increase the saving rate because people have to save more to keep the after-tax yield constant. C. An income tax taxes savings twice only if consumption is the measure used to gauge a person's ability to pay. D. Proponents of income as a tax base argue that you should not be taxed on what you draw out of the common pot, but rather on the basis of your ability to draw from the pot.