Brady pays $37,450 for a new car, including a federal excise tax of $700 and a state sales tax of $1,750. The indirect business tax value added to GDP under the income approach for this purchase is
A. $2,450 because this is income for the government.
B. $2,450 because this is profit for the firm.
C. $700 because only federal taxes are included in indirect business taxes; state taxes are excluded.
D. $1,750 because only state taxes are included in indirect business taxes; federal taxes are excluded.
Answer: A
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Which of the following financial intermediaries is NOT a depository institution?
A) a savings and loan association B) a commercial bank C) a credit union D) a finance company
In 1975, Congress passed a tax rebate to spur consumer spending. Consumers
A. spent the entire amount of the tax savings, boosting the economy, as planned. B. did not spend any of the amount of the tax savings. C. saved a substantial share of the tax savings and spent the rest. D. saved a small portion of the tax savings, and spent the rest.
The price of a futures contract represents the price the market expects the commodity to be when the contract expires.
a. true b. false
Kathy eats five slices of pizza on a Saturday night but admits each slice of pizza doesn't taste as good as the previous one. This suggests that for Kathy the
A. marginal utility of a slice of pizza is positive but decreasing. B. total utility of slices of pizza is increasing by larger and larger increments. C. total utility of slices of pizza is declining. D. marginal utility of a slice of pizza is negative.