If a local government collects taxes of $250,000, has $175,000 of government consumption expenditures, makes transfer payments of $75,000, and has no interest payments or investment, its budget would
A) show a surplus of $100,000.
B) show a surplus of $75,000.
C) be in balance with neither a surplus nor a deficit.
D) show a deficit of $75,000.
C
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Opportunity cost is best defined as:
a. the sum of all alternatives given up when a choice is made. b. the money spent once a choice is made. c. the highest-valued alternative given up when a choice is made. d. the difference between the cost price and the selling price of a good. e. the cost of capital resources used in the production of additional capital.
Which of the following statements is most correct?
A. Usually expected returns are not associated with risk premiums. B. Usually lower expected returns are associated with higher risk premiums. C. Usually higher expected returns are associated with higher risk premiums. D. Usually higher risk premiums are associated with lower expected returns.
Whenever government spending is a substitute for private spending
A) interest rates will rise. B) the Ricardian equivalence theorem holds. C) the effects of expansionary fiscal policy are dampened. D) there is a direct multiplier effect.
The period from 1977 through 1989 saw a wave of corporate mergers in the U.S. These mergers were characterized by
a. the use of junk bonds for financing buyouts. b. the low debt-to-equity ratios of the resulting firms. c. resulting firms that focused on "core competencies" rather than diversification. d. a "buyers' market" in which acquiring firms could purchase the stock of takeover targets for less than market value. e. All of the above.