Suppose the nominal interest rate is 0.03, the tax rate on interest income is 0.2, and the expected real after-tax interest rate is 0.004. What is the expected inflation rate?
A. 0.02
B. 0.01
C. 0.00
D. 0.03
Answer: A
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Special-interest legislation that imposes costs broadly over many taxpayers can be enacted because
a. taxpayers benefit from this type of legislation b. taxpayers remain rationally ignorant of the legislation c. only the wealthy pay these taxes d. these taxes are actually borne by a minority of taxpayers e. the Constitution requires special-interest legislation
In a perfectly competitive market, the products sold can be described as:
(a) Homogenous; (b) Complementary; (c) Close substitutes; (d) Both (a) and (c) are correct.
If the Fed reduces the supply of money, the
A. AS curve shifts outward. B. AS curve shifts inward. C. AD curve shifts outward. D. AD curve shifts inward.
If this pollution occurs, the marginal social cost equals the
A) marginal external cost. B) private marginal cost. C) sum of the private marginal cost and the marginal external cost. D) private marginal cost minus the marginal external cost.