Irving Fisher argued for a tax on consumption instead of on income because
A. consumption is the best indication of ability to pay.
B. the standard of living depends not on income, but on how much is consumed.
C. a tax on consumption raises more revenue than a tax on income.
D. a tax on income discourages saving by taxing savings twice.
Answer: D
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A firm manager predicts and reacts to the moves of the firm’s competitors within the industry. What concept is illustrated by this example?
a. perfect competition b. prisoners’ dilemma c. economies of scale d. mutual interdependence
After the First World War, Germany experienced an economic condition that can be best described as:
A. unanticipated inflation. B. cost-push inflation. C. hyperinflation. D. anticipated inflation.
A firm that can determine the price-output combination in order to maximize profit is known as a
A. demand searcher. B. price searcher. C. cost taker. D. price taker.
Today, the most common exchange rate arrangement in the world is
A. the fixed exchange rate system. B. the managed floating system. C. the gold standard system. D. the freely floating exchange rate system.