An increase in the marginal tax rate, with the average tax rate held constant, will
A) increase the amount of labor supplied at any real wage.
B) not affect the amount of labor supplied at any real wage.
C) decrease the amount of labor supplied at any real wage.
D) increase the amount of labor supplied at any real wage if the average tax rate is above the marginal tax rate, but decrease the amount of labor supplied at any real wage if the average tax rate is below the marginal tax rate.
C
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According to prospect theory,
A) people are concerned with wealth levels only. B) people are concerned with changes in wealth levels only. C) people never use a reference level when making their decisions. D) everybody is risk-neutral.
The main difference between perfect competition and monopolistic competition is
A) the number of sellers in the market. B) the ease of exit from the market. C) the difference in the firm's profits in the long run. D) the degree of product differentiation.
The twosector (manufacturing and agriculture) specific factors model assumes:
a. that there are increasing returns to labor. b. that there are diminishing returns to labor. c. that there are diminishing returns to capital in the agricultural sector. d. that there are diminishing returns to land in the manufacturing sector.
Price controls involve the use of the power of the state to establish prices different from the ______ prices that would otherwise prevail.
a. demand b. supply c. indeterminate d. equilibrium