A major problem with using the egalitarian principle to distribute income is that
A) it would eliminate the incentives that rewards provide in an economic system.
B) it is difficult to know when an equal distribution of income has been achieved.
C) it would not be fair to the wealthy.
D) there exist no mechanisms to carry out such a scheme.
Answer: A) It would eliminate the incentives that rewards provide in an economic system.
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The financial system:
A. brings together savers and borrowers in a set of interconnected markets where people trade a variety of financial products. B. connects the government to those truly in need of public services. C. is used to help individuals keep track of the general price level. D. gathers information about the economy in an effort to inform the public.
A bank has $7 million in checkable deposits and $1.2 million in total reserves. If the required reserve ratio is 10 percent, then the bank has
A) required reserves of $700,000. B) excess reserves of $500,000. C) excess reserves of $1,080,000. D) required reserves of $120,000. E) a and b
During recessions, changes in investment spending are the biggest contributor to changes in
a) retail sales. b) consumer spending. c) real GDP. d) personal income.
Total satisfaction is maximized when
A) marginal utility is positive. B) marginal utility is negative. C) marginal utility is zero. D) marginal utility is equal to average utility.