At the competitive equilibrium with a positive proportional labor income tax
A) the real wage after tax exceeds the marginal product of labor.
B) the real wage after tax equals the marginal product of labor.
C) the real wage after tax is lower than the marginal product of labor.
D) We cannot say.
C
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Suppose a firm's total revenue is $1,000,000. The firm has incurred explicit costs of $750,000
There is also $50,000 of forgone wages by the owner, $10,000 of forgone interest by the owner, $3,000 worth of economic depreciation, and $20,000 worth of normal profit. What is the firm's economic profit? A) $250,000 B) $200,000 C) $190,000 D) $167,000 E) $180,000
A movement along a consumption function is caused by a change in
a. households' real assets b. interest rates c. taxation policy d. expectations of price changes e. households' incomes
Economic theory is a necessity, not a luxury. This statement is true because theory
a. always leads to practical and useful policy. b. can prevent depressions in the economy. c. substitutes for vast amounts of data. d. provides a structure for organizing and analyzing data. e. always leads to accurate predictions.
If the value of the domestic currency depreciates:
a. Aggregate demand rises, but aggregate supply does not change. b. Aggregate demand falls and aggregate supply rises. c. Aggregate demand rises and aggregate supply rises. d. Neither aggregate demand nor aggregate supply change. e. Aggregate demand rises and aggregate supply falls.