Your textbook mentions four arguments against government intervention to reduce inequality. List any three of these.
What will be an ideal response?
The list should include any three of these: taking money away from individuals who have earned it is unfair and immoral; allowing big rewards to go to the most successful performers helps motivate creativity, innovation, and hard work; a policy devoted to reducing inequality eventually leads to political control of the economy and rent-seeking behavior; the income distribution statistics overstate inequality because they fail to take economic mobility into account.
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Refer to Figure 13-8. At the profit-maximizing output level the firm will
A) earn a profit of $60. B) break even. C) earn a profit of $176. D) earn a profit of $88.
The Great Depression:
A. resulted in the development of microeconomics. B. was a period of low production and high unemployment. C. occurred only in the United States. D. ended a few months after the stock market crash of 1929.
If the United States is to reduce poverty by using a negative income tax, the guaranteed income should be
A. two times the tax rate. B. close to the poverty line. C. close to the median income of all families. D. above the poverty line.
Table 5.1National Income Accounts (dollar figures are in billions)Expenditures for consumer goods and services$4,565Exports$740Government purchases of goods and services$1,465Social Security taxes$510Net investment$225Indirect business taxes$520Imports$825Gross investment$865Corporate income taxes$185Personal income taxes$750Corporate retained earnings$45Net foreign factor income$20Government transfer payments to households$690Net interest payments to households$0On the basis of Table 5.1, personal saving is
A. $6,445 billion. B. $5,790 billion. C. $5,620 billion. D. $6,530 billion.