It the marginal social benefit from contributions to charities is the same for all individuals who give to charities, then allowing individuals to deduct charitable contributions from their income taxes cannot serve as a Pigouvian subsidy under a progressive income tax system.
Answer the following statement true (T) or false (F)
True
Rationale: Under a progressive income tax system, different individuals pay different marginal tax rates -- which implies the subsidy given for charitable contributions differs across individuals (with higher income individuals receiving a larger subsidy).
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A) raising payroll taxes or cutting benefits. B) raising payroll taxes or raising benefits. C) cutting payroll taxes or cutting benefits. D) cutting payroll taxes or raising benefits.
Describe how the Fed uses open market operations to change short-term and long-term interest rates
What will be an ideal response?
Factors likely to cause a financial crisis in emerging market countries include
A) severe fiscal imbalances. B) decreases in foreign interest rates. C) a foreign exchange crisis. D) too strong oversight of the financial industry.
People are forced to make choices because of:
a. unlimited wants and unlimited resources. b. limited wants and unlimited resources. c. unlimited wants and limited resources. d. limited wants and limited resources. e. irrational wants and limited resources.