An excise tax
a. is a sales tax on the purchase of a particular good or service.
b. is a tax on the profits earned from the sale of an asset.
c. represents a surcharge on corporate profits beyond the normal corporate tax rate.
d. is a tax on income-earning rental property.
a
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Answer the following statement(s) true (T) or false (F)
1. The Battle of the Sexes game has two Nash equilibria, neither of which is Pareto optimal. 2. All outcomes in the Copycat Game are Nash equilibria. 3. A solution concept is any way of analyzing a game which leads to the discovery of a Nash equilibrium which solves the game. 4. The concept of Nash Equilibrium is an important solution concept because it helps make predictions. 5. When a game has more than one Nash equilibrium, it is unlikely that a stable equilibrium will ever be reached.
In a system of 100-percent-reserve banking,
a. banks do not make loans. b. currency is the only form of money. c. deposits are banks' only assets. d. All of the above are correct.
According to rational expectations theory, which of the following is the best approach to lower the inflation rate?
A. preannounced stable government policies B. unpredictable government policies C. first predictable and then unpredictable government policies D. None of these.
Questions of exactly where to draw the line on government interference in the economy
A. are best answered by non-economists. B. can be answered easily using the tools of economics. C. are the subject of intense political debate. D. can only be answered through a democratic process.