Which of the following is not an argument in favor of reforming the tax laws to encourage saving?
a. Saving is a key determinant of long-run prosperity.
b. Current tax laws discourage saving for the purpose of leaving a large bequest.
c. The substitution effect of a higher return to saving may be about equal to the income effect of a higher return to saving.
d. The tax code currently taxes some forms of capital income twice.
c
You might also like to view...
Costs paid in money to hire a resource is
A) normal profit. B) an implicit cost. C) an explicit cost. D) an alternative-use cost. E) economic profit.
Ceteris paribus when graphing a relationship refers to
A) letting all the variables change at once. B) changing the origin of the graph. C) holding constant all but two variables. D) rescaling the coordinates.
A particular music store, Discs-R-Us, sells over 3,000 different compact disks. Pat's opportunity cost of choosing to purchase a compact disk by Pearl Jam
a. is zero if he does not like any other compact disk b. is how much he would have enjoyed his second-favorite compact disk c. depends on the compact disks not sold by the store d. is negative e. is how much he would have enjoyed a compact disk by Vanilla Ice
If in a certain year the indices of prices received and paid by farmers were 115 and 142 respectively, the parity ratio (in percentage terms) would be:
A. 123. B. 81. C. 69. D. 27.