People who believe in the ability-to-pay principle would most likely favor ______.
a. regressive taxes
b. progressive taxes
c. flat taxes
d. excise taxes
b. progressive taxes
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When Joe's disposable income is $50,000, his consumption expenditure is $45,000, and when his disposable income is $60,000, his consumption expenditure is $53,000. Joe's marginal propensity to consume is
A) 100. B) 1.25 C) 80. D) 0.80. E) $8,000.
A corporation ________ taxes on its profits and its stockholders ________ taxes on any dividends made to them by the company
A) pays; pay B) pays; do not pay C) does not pay; pay D) does not pay; do not pay
Unemployment due to the location or skill requirements of job vacancies not matching the location or skills of the unemployed is called ________ unemployment
A) turnover B) mismatch C) cyclical D) natural
Suppose the economy has a recessionary gap. If supply-side effects are very strong in relation to the demand-side effects,
A) the impact of tax cuts will be strengthened because the increase in disposable income induces consumption, which in turn encourages firms to expand production, thereby shifting the short- run aggregate supply curve to the right. B) the impact of tax cuts will be strengthened because in addition increasing aggregate demand, long-run and short-run aggregate supply will also increase. C) the impact of increased transfer payments to help re-tool the unemployed with new skills will be strengthened, thereby shifting the aggregate demand curve further to the right. D) the impact of increased transfer payments to help re-tool the unemployed with new skills will be strengthened, thereby shifting the short-run aggregate supply curve to the right.