What is the difference between nominal and effective tax rates? What creates the distinction?
What will be an ideal response?
The nominal tax rate is calculated by dividing taxes paid by taxable income, while the effective tax rate is calculated by dividing taxes paid by total (or gross) income. The loophole exemptions and deductions and tax credits create a distinction between total (or gross) income and taxable income.
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Managed float means
a. a fixed exchange rate system with regularly scheduled periodic devaluations b. a freely floating exchange rate system c. a hybrid of freely floating exchange rates with occasional intervention by central banks d. a fixed exchange rate system managed by the European Community e. a flexible exchange rate system managed entirely by the IMF
To determine the marginal physical product of labor, you must
a. hold total output constant and calculate how much revenue an additional worker generates b. hold capital constant and calculate how much revenue an additional worker generates hold capital constant c. hold all other factors of production constant and calculate how much output an additional worker produces d. hold labor constant and calculate how much output an additional worker produces e. hold labor constant and calculate how much revenue an additional worker generates
The CPI for 2008 is computed by dividing the price of the basket of goods and services in 2008 by the price of the basket of goods and services in the base year, then multiplying by 100
a. True b. False Indicate whether the statement is true or false
An decrease in the velocity of money will shift the
a. IS curve up. b. LM curve up. c. LM curve down. d. IS curve down.