Supply-side theory asserts that high marginal tax rates
A) encourage private saving.
B) encourage business investment.
C) discourage government expenditures.
D) discourage work effort.
D
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The aggregate production function of Ritland is Y = A × K0.3 × H0.7. The total output produced in Ritland in a certain year was worth $135,000
The technology used in the country improved over the next 10 years while the capital stock and the efficiency units of labor remained approximately the same. Which of the following is likely to be true in this case? A) The Human Development Index of the country is likely to improve. B) The gross domestic product of the country is likely to increase. C) The gross domestic product of the country is likely to decrease. D) The inflation rate in the country is likely to reduce.
Which of the following is the best example of a "screen" being used to anticipate the effects of "adverse selection"?
A. Insurance companies require all homeowners to have smoke detectors. B. A health insurance company creates a single, large "pool" of insureds C. An auto insurer awards cash rebates to existing policyholders with good driving records. D. Prospective computer programmers must demonstrate their coding skills in person during the actual job interview.
The perfectly competitive firm maximizes profits when
A. it produces and sells the quantity at which the difference between price and average cost is the greatest. B. it produces and sells the quantity at which marginal revenue and marginal cost are equal. C. it produces and sells the quantity at which the difference between marginal revenue and marginal cost is the greatest. D. it produces and sells the quantity at which the difference between average revenue and average cost is the greatest.
In economics, investment always refers to
A. the creation of capital. B. an increase in per capita output. C. increasing the quantity of labor. D. the act of buying stocks or bonds.