Suppose a country imposes a lump-sum income tax of $6,000 on each individual in the country. What is the average income tax rate for an individual who earns $60,000 during the year?
a. 0%
b. 10%
c. More than 10%
d. The average tax rate cannot be determined without knowing the entire tax schedule.
b
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If your risk of losing your house to catastrophe is 25%, how much would fair insurance cost if your home were worth $1,000,000?
A) $250,000 B) $750,000 C) $1,000,000 D) Unable to determine with the information given.
To use an analogy that helps explain the ABCs of economic development: To build a skyscraper, you must first build the foundation. In order for an economy to create economic development, it must first develop an infrastructure. The infrastructure investment refers to
a. networks of factories b. a high birth rate c. markets d. roads, schools, telecommunications systems, hospitals e. an access to foreign investment
Lydia, a citizen of Italy, produces scarves and purses that she sells to department stores in the United States. Other things the same, these sales
a. increase U.S. net exports and have no effect on Italian net exports. b. decrease U.S. net exports and have no effect on Italian net exports. c. increase U.S. net exports and decrease Italian net exports. d. decrease U.S. net exports and increase Italian net exports.
Economic analysis indicates that high tax rates will
A) promote wasteful use of resources. B) retard capital formation. C) all of the above. D) reduce productive activity.