Explain why most retired individuals are not likely to be heavily invested in municipal bonds.
What will be an ideal response?
Most retired individuals are not working and as a result, they may find themselves in a relatively low marginal tax bracket. As a result, the tax-exempt status of municipal bond interest is less beneficial and hence, less attractive to them.
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In monopolistic competition, profit is maximized by producing so that marginal revenue
A) equals price. B) is negative. C) equals marginal cost and which are less than price. D) equals average total cost but not marginal cost. E) equals marginal cost and equals price.
Which of the following is considered in the AS/AD model but was not considered in the short-run macro model?
a. The effect of price changes. b. The effect of interest rate changes. c. Increases in government spending. d. Monetary policy. e. Decreases in government spending.
When the absolute percentage change in quantity demanded is just equal to the percentage change in price, demand is
A) elastic. B) perfectly inelastic. C) unit-elastic. D) relatively inelastic.
The marginal product of labor is defined as
A) the additional sales revenue that results when one more worker is hired. B) the additional output that results when one more worker is hired, holding all other resources constant. C) the additional number of workers required to produce one more unit of output. D) the cost of hiring one more worker.