A capital gains tax is a tax on the:
A. earnings of individuals and corporations.
B. income earned by buying assets and selling them at a higher price.
C. wages paid to an employee.
D. value of a good or service being purchased.
B. income earned by buying assets and selling them at a higher price.
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Which of the following is true of a second-price sealed-bid auction?
A) Bidders directly compete with each other. B) Bidders submit their bids simultaneously. C) Bidders know each other's bid. D) Bidders always bid above their willingness to pay.
The production possibilities curve shows that:
A. some of one good must be given up to get more of another good in an economy that is operating efficiently. B. no output combination is impossible. C. an economy that is operating efficiently can have more of one good without giving up some of another good. D. scarcity can be eliminated.
The value of total output must equal the value of total income in an economy for all of the following reasons except
A. For the circular nature of spending and income in the economy. B. Government expenditures must equal government revenues. C. One person's expenditures on goods and services is another person's income. D. Income earned is spent on goods and services, which creates additional production.
Stock market bubbles typically lead to all of the following except:
A. patterns of volatile returns from the stock market. B. gaps between actual stock prices and those warranted by the fundamentals. C. an efficient allocation of resources. D. stock market crashes.