Which of the following is a regressive tax?
A. a state tax of 5 percent of income
B. a local sales tax of 5 percent
C. the federal individual income tax
D. a federal flat tax of 30 percent
Answer: B
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Time inconsistency means
A) taking different decisions at different times despite facing the same situation. B) making policy choices that violate the intertemporal budget constraint. C) deciding to do something tomorrow, and then doing something different tomorrow. D) adding a random factor to decisions.
A citizen of Mexico who has lived in El Paso during the past three years has just sent $100 to relatives in Mexico for Christmas. This transaction is
A) counted in the U.S. balance of payments as a current account item. B) counted in the U.S. balance of payments as a surplus item. C) counted in the U.S. balance of payments as an export item. D) none of the above.
The GDP of Country A is equal to $124.5 billion, and the consumption expenditure in the economy is $85.9 billion. The government of Country A charges a flat tax of 20 percent. The government also spends $4.5 billion per year in the form of transfer payments. The disposable income of the country is equal to: a. $99.6 billion
b. $104.1 billion. c. $124.5 billion. d. $129.0 billion.
Ellie and Brendan both produce apple pies and vanilla ice cream. If Ellie's opportunity cost of one apple pie is 1/2 gallon of ice cream and Brendan's opportunity cost of one apple pie is 1/4 gallon of ice cream, Ellie has a comparative advantage in the production of ice cream
a. True b. False Indicate whether the statement is true or false