If a tax is proportional, the average tax rate
a. remains the same as income rises.
b. rises as income rises.
c. falls as income rises.
d. falls as income falls.
a
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When tax revenues ________ outlays is positive, then the government has a budget ________
A) plus; deficit B) minus; deficit C) minus; surplus D) plus; surplus E) divided by; surplus
Refer to the figure above. If the monopolist faces a constant marginal cost of $2, at what price should it sell its output?
A) $2 B) $6 C) $10 D) $12
Which of the following situations probably would not yield a negative externality?
A. a rock concert in the quad next to the library B. one person who is smoking cigarettes in a closed room where several other people are present C. a tutor quietly instructs a student in economics as a bystander willingly listens in without the tutor knowing it D. mowing your lawn early on a Saturday morning when you live in a densely populated neighborhood E. All of the above situations would yield negative externalities.
If the center nation operates under a cooperative peg agreement, how does the cooperation work?
A) The home nation will try to resist any changes coming from the center. B) The home nation will accept all changes coming from the center without discussion. C) The center nation will make policy concessions to other nations in its cooperative currency agreement. D) Cooperation usually does not work well.