When a country's inflation rate varies substantially from year-to-year and is therefore difficult to predict, this will
What will be an ideal response?
reduce the volume of trade and the gains derived from it
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The idea behind a flat tax is to _____
a. cut taxes on high-income taxpayers b. to raise taxes on high-income taxpayers c. increase progressivity d. minimize the excess burden of the income tax
A _______ is a combination of habit and everyday expectations mixed with an appropriate amount of novelty and adventure
a. Domino effect b. Dopler zone c. Comfort zone d. Circadian rhythm
Typically, as a firm hires additional workers, the marginal product of labor
a. decreases, and the value of the marginal product of labor decreases. b. stays constant, and the value of the marginal product of labor decreases. c. decreases, and the value of the marginal product of labor stays constant. d. decreases, and the value of the marginal product of labor increases.
There are ten states in the democratic nation of Katlandia, and each state has ten thousand residents. Although incomes vary, each Katlandian pays a tax equal to the total cost of all government projects divided by the number of residents in the country. Currently, two states each have one army base. An army base adds $2 million to a state's local economy each year. In addition, in terms of increased security, the annual marginal benefit to Katlandia of having an additional army base is shown below. The total cost of an army base is $8 million per year.
It is socially optimal for Katlandia to have:
A. four army bases. B. two army bases. C. three army bases. D. one army base.