According to the ability-to-pay principle, it is fair for people to pay taxes based on their ability to handle the financial burden
a. True
b. False
Indicate whether the statement is true or false
True
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Like tariffs, quotas tend to lead to
A) higher prices and reduced imports. B) increased government revenue. C) increased consumer surplus. D) All of the above.
Use the following general linear demand relation:Qd = 100 - 5P + 0.004M - 5PRwhere P is the price of good X, M is income, and PR is the price of a related good, R. If income increases to $100,000 and the price of the related good is now $20, what is the demand function?
A. Qd = 100 - 10P B. Qd = 400 - 5P C. Qd = 400 - 10P D. Qd = 300 - 5P E. none of the above
Which of the following statements is NOT true about Say's law?
A. Markets would be regularly hit by severe shortages and surpluses. B. Desired expenditures will equal actual expenditures. C. People produce more goods than they want for their own use only if they seek to trade them for other goods. D. Surpluses will be eliminated by falling prices and shortages will be eliminated by increasing prices.
An explicit cost is
A) a nonmonetary opportunity cost. B) a cost specifically related to government rules and regulations. C) a cost that involves spending money. D) a cost unique to corporations.