The rate of interest affects agriculture because
A) A high interest rate suggests a stronger dollar which depresses farm export demand.
B) A low interest rate lowers farm expenses.
C) A high interest rate reduced the capitalized value of farmland.
D) All of the above.
Answer: D
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In the United States, all levels of government together spend about
a. one out of every three dollars paid for finished goods and services b. half of the dollars paid for defense spending c. the same amount as private citizens and corporations d. one out of every three dollars paid for education e. 80 percent of their budgets on transfer payments
Direct controls work if
a. there is vigilance and enthusiasm in enforcement by the regulatory agency. b. speed and rigor are used in the court system in prosecuting cases. c. there are significant penalties imposed by the legal system. d. All of the above occur.
Taxes that are enacted to mitigate the effects of negative externalities are sometimes called
a. control taxes. b. command levies. c. Pigovian taxes. d. Marshallian taxes.
Much of the U.S. government’s budget is tied to the Consumer Price Index (CPI), including Social Security benefits. Assume that the Social Security Administration (SSA) pays $980 million in benefits this year. If the CPI overstates inflation by 1 percent, how much money does the SSA stand to lose due to overpayments the following year?
a. $98,000 b. $980,000 c. $9.8 million d. $98 million