The difference between GNP and GDP is explained by:
(a) Exports and imports;
(b) The level of investment;
(c) Net factor income from abroad;
(d) None of the above.
Ans: (c) Net factor income from abroad;
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In the "cost of capital channel" of monetary policy, a lower interest rate __________ spending
A) raises consumption B) raises investment C) lowers consumption D) lowers investment
National income is defined as gross national product minus
a. depreciation and net taxes. b. national income. c. depreciation. d. personal disposable income.
Assuming that we can properly measure ability to pay, how do we use the principle of vertical equity to determine how much someone with greater ability to pay should pay in taxes?
a. By integrating it with the principle of horizontal equity. b. Through reference to the benefit principle. c. By looking at elasticities of demand for various income quintiles for the good in question. d. We cannot use the principle of vertical equity to answer this question.
A fair bet is one where
A) the player has a 50/50 chance of winning. B) the player's utility function is convex. C) the expected value is zero. D) the expected value is positive.