Which of the following is a normative statement?
a. If tax rebate checks are sent in August, retail sales will improve in September.
b. Tax code simplification will result in less expenditure on accounting services.
c. If interest rates go up, consumption expenditures will fall.
d. Tax code simplifications should include reduction of all tax rates.
Answer: d. Tax code simplifications should include reduction of all tax rates.
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Which of the following is true of a current account surplus? a. A country that is running a current account surplus will have negative net exports
b. A current account surplus is consistent with domestic spending being in excess of domestic production. c. A current account surplus means that a country is also running a net surplus in its financial account. d. A country can have a current account surplus only if it exports more services as compared to goods. e. A country that is running a current account surplus buys more bonds from the rest of the world as compared to what it sells.
Investment in capital goods is one way to increase the standard of living in the future. Investment in capital goods, however, means that we must forgo consumption today. One of the trade-offs facing an economy is the balance of consumption today with that of the future. The following table shows such a trade-off. With this information we know that the opportunity cost of which of the following is the greatest?Current consumptionFuture consumption800100750260650340600380550400
A. Increasing current consumption from 750 to 800 B. Increasing current consumption from 600 to 650 C. Increasing current consumption from 650 to 750 D. Increasing current consumption from 550 to 600
Which of the following is the primary source of high earnings in a market economy?
A) a willingness to work hard even if you are not productive B) a willingness to exploit workers and consumers C) the ability to provide others with things that they value highly D) a willingness to engage in actions where you gain at the expense of others
If the local slaughterhouse gives off an unpleasant stench, then the equilibrium quantity of meat will be ________ the quantity that maximizes total economic surplus.
A. more equitable B. lower than C. higher than D. equal to