The principal of neutrality states that, with respect to economic decisions, all taxes must be neutral.
Answer the following statement true (T) or false (F)
False
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If a monopolist's marginal revenue is $25 and its marginal cost is $19, then the monopolist should:
A. raise its price. B. increase its output. C. decrease its output. D. leave its output and price unchanged.
If the marginal propensity to save is 0.4, the multiplier is 2.5
Indicate whether the statement is true or false
Which one of the following was a secondary effect of the stock market crash of 1929?
a. an increase in the money supply in the early 1930s b. a decline in consumption expenditures because of the reduction in the wealth of stockholders c. an increase in the supply of loanable funds as people transferred funds from the stock market into savings accounts d. an increase in tax revenues as the sellers of stocks paid the capital gains tax on stocks that had appreciated during the 1920s
If demand is inelastic and the government decides to raise the tax on water, the price of water will increase by a ________ amount and water consumers will bear a ________ share of the tax.
A. large; large B. large; small C. small; large D. small; small