Hailey's income is $40 per week. She spends all of it on coffee (C) and doughnuts (D). Coffee costs $2 per cup and doughnuts cost $1 each. Her marginal rate of substitution for coffee with doughnuts is D/C. How many cups of coffee and how many doughnuts will she purchase each week?
A. 15 cups of coffee and 10 doughnuts
B. 10 cups of coffee and 20 doughnuts
C. 20 cups of coffee and 10 doughnuts
D. 5 cups of coffee and 30 doughnuts
B. 10 cups of coffee and 20 doughnuts
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A progressive income tax is one that
A) taxes income so that the average tax rate decreases with the level of income. B) taxes all income above the guaranteed minimum at an average rate that decreases with income. C) taxes income so that the average tax rate increases with the level of income. D) taxes income at a constant rate, regardless of the level of income.
The ________ relation indicates that the interest differential between investments in two currencies will equal the forward premium or discount between the currencies
A) Fisher equation B) interest rate parity C) purchasing power parity D) term structure of interest rates
What act of Congress declared restraint of trade illegal and declared any attempt at monopolizing unlawful?
a. the Celler-Kefauver Anti-Merger Act b. the Sherman Antitrust Act c. the Clayton Act d. the Wheeler-Lea Act e. the Clayton-Celler Act
Tariffs and quotas are used to promote trade with foreign countries
Indicate whether the statement is true or false