Explain and evaluate this statement: “No tax on income can be a just tax unless it leaves individuals in the same relative condition in which it found them.”
What will be an ideal response?
This statement is saying that the only just tax is one which does not change the rank of individuals with respect to their income, i.e., the highest 10% of income earners before taxes will still have the highest 10% after-tax income. Whether or not you believe this is “just” is a matter of opinion. Fairness is a normative, not a positive, concept. Some would say that the only just tax is one that leaves everyone situated in equal positions after taxes. A true Marxist might argue that you tax each “according to his ability and give to each according to his needs.” There are many different views about what is just when it comes to taxes, and the statement simply reflects a view that is probably quite acceptable to many, but not to all.
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The North American Free Trade Agreement signed in 1993 lowered tariffs among the United States, Canada, and Mexico. What would proponents of the treaty consider to be the likely benefits?
What will be an ideal response?
One inconvenience of commodity money is the need for
a. money to be divisible. b. uniform quality. c. portability. d. All of the above are correct.
The coefficient that represents the average number of times a dollar is used to buy goods and services is called
a. the demand for money. b. the quantity theory of money. c. the price level. d. the velocity of money.
Refer to Figure 9-1. Based on the graph of the labor market above, if a minimum wage is set at $5 per hour, which of the following will occur?
A) The level of unemployment will rise, but the percentage of the labor force unemployed will not change. B) The unemployment rate will fall. C) The unemployment rate will rise. D) None of the above will occur.