The federal income tax is a progressive tax. Which of the following statements describes why this helps lower income inequality?
a. Rich households pay a lower percentage of their income in taxes compared to poor households.
b. Rich households pay the same percentage of their income in taxes compared to poor households.
c. Rich households pay a higher percentage of their income in taxes compared to poor households.
d. Rich households pay an absolute higher amount of their income in taxes compared to poor households.
c. Rich households pay a higher percentage of their income in taxes compared to poor households.
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Before the Industrial Revolution, living standards in the world
A. were relatively stagnant for long periods of time. B. were declining because of rapid increases in population. C. were already rising significantly for many decades. D. are not known, for lack of reliable records from that period.
In economics, an organization that produces a good or service is called a
A) business. B) firm. C) company. D) All of the above are correct.
Keynes's theory of the demand for money is consistent with ________ movements in ________
A) countercyclical; velocity B) procyclical; velocity C) countercyclical; expectations D) procyclical; expectations
Suppose that in a certain society $10,000 is the official cut-off of income for the poor. This means that any person making less than $10,000 is considered poor. Suppose further that there are three people in this society: Randy, Marlon, and Tito, with incomes of $9,900, $9,900, and $5,000, respectively.
A) How many people are in poverty? B) How much income would it take, on average, to lift every poor person out of poverty? C) What if some policy caused $200 to be taken from Tito and given to Randy. How many people are in poverty now? How much income would it take, on average, to lift every poor person out of poverty?