The burden of a regressive tax ________ as a percentage of income as income ________.
A. does not change; rises
B. rises; falls
C. rises; rises
D. does not change; falls
Answer: B
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Exhibit 2-15 Production possibilities curve
In Exhibit 2-15, the economy will experience the most future economic growth if it chooses what point now?
A. J. B. K. C. M. D. N.
Other things equal, the multiplier effect associated with a change in government spending is:
A. the same as that associated with a change in taxes. B. equal to that associated with a change in investment or consumption. C. less than that associated with a change in investment. D. greater than that associated with a change in investment.
When economists assume that people are rational and respond to incentives, they mean
A) people act with kindness. B) people act in their own self-interest. C) people are altruistic. D) people are selfish.
Your firm owns an old truck that is used to make local deliveries. The truck is fully depreciated and only costs $1.20 per hour to operate, but you could rent it to another firm for $15.00 per hour
What is the opportunity cost of operating this truck in your business? A) $1.20 per hour B) $15.00 per hour C) $16.20 per hour D) Less than $1.20 per hour