If income tax rates are increased in an attempt to balance the federal budget, we should expect to see
A. an increase in consumption and a decrease in GDP.
B. an increase in consumption and an increase in GDP.
C. a decrease in consumption and a decrease in GDP.
D. a decrease in consumption and an increase in GDP.
Answer: C
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The symmetry principle is the requirement that
A) people in similar situations be treated similarly. B) Society's income be distributed symmetrically among its members. C) the poorest 20 percent of households should receive the same total income as the richest 10 percent of households. D) the average person be made as well off as possible.
In an effort to clean up the amount of sulfates introduced into the atmosphere the government has ruled that all polluters install smoke stack scrubbers on their smoke stacks and mandated a pollution limit on the amount of sulfates per parts of air
that may be legally emitted into the atmosphere. Suppose some of the polluters have found a more efficient way to eliminate the pollution. How will this discovery change the amount of sulfates emitted into the atmosphere?
Typically, as an economy begins to emerge from a recessionary phase of the business cycle,
A) unemployment falls immediately. B) inflation begins to fall. C) unemployment continues to rise. D) investment begins to fall.
Which of the following losses to an individual would an insurance company NOT cover?
A) The person's automobile is stolen. B) Fire destroys the person's home. C) The person's father dies. D) The person's country is invaded.