In England during the Middle Ages each village had an area of pasture on which any family in the village was allowed to graze its cows and sheep without charge
Eventually, the grass in the pasture would be depleted and no family's cow or sheep would get enough to eat. The reason the grass was depleted was
A) it did not get enough rainfall.
B) the area of pasture was nonexcludable and the consumption of the grass was rival.
C) self-interest motives led livestock owners to raise too many cows and sheep.
D) due to a policy of neglect on the part of the English government.
B
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A tax on the income earned by buying investments and selling them at a higher price is called the:
A. sales tax. B. corporate income tax. C. capital gains tax. D. excise tax.
If the demand for a commodity is perfectly elastic, a downward shift in supply will result in lower prices
Indicate whether the statement is true or false
The size of the underground economy would tend to increase if the government of a country
A) decreased government regulations on businesses. B) increased income tax rates. C) legalized prostitution. D) legalized marijuana.
Susan recently purchased a home for $150,000. She plans to rent it out for $1,000 per month for a year. Had the house cost $200,000 instead, her expected rate of return would have:
A. Decreased by 1 percentage point B. Decreased by 2 percentage point C. Increased by 2 percentage point D. Increased by 3 percentage point