Special taxes levied on earnings for Social Security and Medicare are called:
A. a withholding tax on wages.
B. a social insurance tax.
C. an unfair tax on low-income families.
D. an exception tax for corporations.
Answer: B
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Assuming the demand curve in question is downward sloping, the calculated price elasticity of demand will always be negative
Indicate whether the statement is true or false
Madison, the CPA, is faster than Mason, the house painter, at both accounting services and painting. This means that:
A. there is no reason for them to trade services. B. Madison should trade her accounting services for Mason's painting services, so long as Madison is relatively more efficient at accounting services. C. Madison should trade her accounting services for Mason's painting services, so long as Madison is relatively more efficient at painting. D. Madison has the comparative advantage in both services.
Microeconomics is _____ while macroeconomics is _____.
a. always positive in nature; always normative in nature b. the area of economics which studies how individuals make decisions; the area of economics which studies the big picture c. the study of the economy as a whole; the study of the behavior of individual decision makers d. why economists agree; why economists disagree
Which of the following observations is true of subsidies? a. They act as barriers to trade
b. They reduce the amounts of actual labor, raw material, and capital costs of production. c. They are capable of distorting trade patterns. d. They reduce inefficiencies.