The size of the underground economy would tend to decrease if the government of a country
A) increased income tax rates.
B) increased business taxes.
C) decreased government regulations on businesses.
D) made over-the-counter drugs illegal.
C
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Which of the following forms of business organization is likely to suffer most from the principal agent problem between the owners and managers of the business?
A) proprietorships B) partnerships C) corporations D) All are equally likely to suffer from the principal-agent problem.
Because of a decrease in the wage rate it must pay, a perfectly competitive firm's marginal costs decrease but its demand curve stays the same. As a result, the firm
A) decreases the amount of output it produces and raises its price. B) increases the amount of output it produces and lowers it price. C) increases the amount of output it produces and does not change its price. D) decreases the amount of output it produces and lowers its price.
If the CPI in 2004 is 200, and in 2005 the CPI is 180, the rate of inflation from 2004 to 2005 is
A) 20%. B) 10%. C) 0%. D) -10%.
It more difficult for firms to reach collusive agreements when they are of different sizes, with substantially different production costs and estimates of demand conditions, than when these differences are smaller
a. True b. False Indicate whether the statement is true or false