The profits of a partnership are
A) taxed as personal income.
B) subject to a corporate tax.
C) taxed as capital gains indexed for inflation.
D) exempt from taxation.
A
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When Joe maximizes utility, he finds that his MRS of X for Y is greater than Px/Py. It is most likely that:
A) Joe's preferences are incomplete. B) Joe's preferences are irrational. C) Joe is not consuming good X. D) Joe is not consuming good Y.
In reference to the long-run firm competitive equilibrium diagram, which of the following statements is INCORRECT?
A) In the long run, the firm has no incentive to alter its scale of operations. B) Because profits must be zero in the long run, the firm's short-run average costs (SAC) must equal P at Qe, which occurs at minimum SAC. C) In the long run, the firm operates where price, marginal revenue, marginal cost, short-run minimum average cost, and long-run minimum average cost all are equal. D) In the long run, this firm must be part of a constant-cost industry, because its marginal revenue curve is perfectly elastic.
Ceteris paribus, if the market supply of a product decreases, then equilibrium quantity will (be) ____ and equilibrium price will (be) ____
a. increase; increase b. decrease; increase c. decrease; indeterminate d. increase; decrease
The trading of votes by elected officials to secure favorable outcomes is called:
A. splitting the difference. B. social engineering. C. logrolling. D. grandstanding.