Taxes play an important role in bond returns because:
A. all interest from owning bonds is taxed.
B. some bond interest is exempt from some government taxation, so after tax returns across bonds can vary considerably.
C. all governments (federal, state, municipal) tax bonds similarly.
D. only U.S. Treasury bonds are tax-exempt, so investors should always seek higher returns from other bonds.
Answer: B
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An intermediate good is a good that is
A) neither normal nor inferior. B) used as an input. C) a stand-in for all goods. D) is tangible good that includes substantial services.
If an increase prices increases total revenue in the short run, what will it do to total revenue in the long run?
a. It will decrease total revenue in the long run b. It will increase total revenue in the long run. c. It will leave total revenue unchanged in the long run. d. Any of the above results are possible in the long run.
The expected benefit of investment equals:
A. the real interest rate. B. the value of the marginal product of capital. C. private saving. D. the price of the capital good.
Suppose the growth rate of GDP in the United States is 4.2 percent. If 2.9 percent and 1.3 percent of GDP growth are due, respectively, to capital and labor growth, the amount resulting from technological progress is:
A. 0 percent. B. 1.3 percent. C. 2.9 percent. D. 4.2 percent.