If the marginal income tax rate falls from 50 percent to 40 percent:
A. after-tax wages decline.
B. the incentive to work becomes weaker.
C. the average tax rate rises.
D. the incentive to work becomes stronger.
Answer: D
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Which of the following is an assumption used when drawing a production possibilities frontier?
i. Human wants and desires are limited to what is available. ii. Only two goods are considered. iii. The level of technology is fixed and unchanging. A) i only B) ii only C) i and iii D) ii and iii E) i, ii, and iii
The Bretton Woods System failed in 1971 due to:
A. high rates of inflation in the U.S. B. the desire on the part of participating countries to have an independent monetary policy. C. greater mobility of capital across international borders. D. all of the reasons given are correct.
Suppose the Fed decreased the growth rate of the money supply. Which of the following would be lower in the long run?
a. both the natural rate of unemployment and the inflation rate b. the natural rate of unemployment, but not the inflation rate c. the inflation rate, but not the natural rate of unemployment d. neither the natural unemployment rate nor the inflation rate
If DeShawn only pays $25,000 to purchase a new car even though he would have been willing to pay as much as $35,000 for the care, this indicates
What will be an ideal response?