A substantial decrease in marginal tax rates will encourage individuals to
a. increase their earnings and work effort.
b. save a smaller portion of their income.
c. take more time off for vacations.
d. spend more on tax-deductible items.
A
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The marginal propensity to save is 0.2. Equilibrium real GDP will decrease by $50 billion if aggregate expenditures schedule decrease by
A. $15 billion. B. $10 billion. C. $16 billion. D. $40 billion.
What factors have slowed down the movement to a system where all payments are made electronically?
What will be an ideal response?
If any country decides to exit from the Eurozone, it will gain ________
A) free capital mobility B) a fixed exchange rate C) reduced transactions costs D) monetary policy independence
Markets tend to produce too little of an excludable public good because
A) transaction costs are high. B) of the lack of rivalry. C) these goods are depletable. D) All of the above.