Which of the following is a statement of positive economics?
a. Too much government spending is the biggest problem facing the U.S. economy.
b. Creating jobs is the most serious problem facing the U.S. economy.
c. Raising taxes provides additional revenue that should be used to finance health care.
d. If taxes are over 50 percent of national income, job creation falls.
d
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Answer the following statement(s) true (T) or false (F)
1. If the Open Range Field is currently a common property and the government decides to charge an entrance fee, this would result in an optimal level of activity in the Open Range Field. 2. Crowding at a common property site both reduces the benefits of visitors and increases the costs of being a visitor. 3. When people have identical tastes, nobody has any incentive to maintain or improve a property that is commonly owned. 4. When people have identical tastes, the rents created by a common property are totally dissipated. 5. When people have identical tastes, social gain can be created from a common property by imposing a Pigovian tax on entrants.
An economist would say the price is too high for a certain service if
a. poor people couldn't afford to buy it. b. nobody could afford to buy it. c. the price was above marginal cost. d. it is an essential service and consumes a significant share of income.
Entry into a monopolistically competitive industry
A. is very difficult. B. is about the same as entering a monopoly industry. C. is relatively easy. D. can be easy or difficult, depending on the type of product.
Suppose a tax on buyers has been imposed in the graph shown. The amount of deadweight loss generated by this tax is:
A. $0. B. $72. C. $36. D. $18.