Which of the following is an example of horizontal equity?
a. A wealthy individual should pay more taxes than a lower-income individual
b. A wealthy individual should have a greater average tax rate than a middle-income individual
c. Two persons with identical incomes should pay the same taxes
d. A local government decides to impose taxes based on the benefits principle
c
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The most commonly used measure of changes in the cost of living for households
a. real GDP. b. the CPI. c. nominal GDP. d. the GDP deflator.
In the Keynesian system, an increase in the money stock would
a. increase the interest rate, which, in turn, would increase aggregate demand and income. b. decrease the interest rate, which, in turn, would decrease aggregate demand and income. c. decrease the interest rate, which, in turn, would increase aggregate demand and income. d. decrease the interest rate but would have no effect on aggregate demand and income.
Buying electricity off the freewheeling grid at one quarter 'til the hour for delivery on the hour illustrates:
a. relational contracts with distributors b. vertical requirements contracts c. spot market transactions d. variable price agreements
In a self-regulating economy, inflationary and recessionary gaps produce shifts of the
A) AD curve that maintain the short-run equilibrium point. B) AD curve that move the economy to a long-run equilibrium point. C) SRAS curve that maintain the short-run equilibrium point. D) SRAS curve that move the economy to a long-run equilibrium point.