Assume a family that earns $20,000 pays $1,000 in income taxes, while a family that earns $40,000 pays $3,750 in income taxes. In this situation, the income tax system is
A. regressive.
B. progressive.
C. proportional.
D. one of these but we cannot tell which one without more information.
Answer: B
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Time series regression is based on series which exhibit serial correlation.
Answer the following statement true (T) or false (F)
Diminishing marginal utility means that as more of a good is consumed
A. the rate at which total utility increases stays the same. B. there is no impact on the rate of change of total utility. C. the rate at which total utility increases starts to increase. D. the rate at which total utility increases starts to diminish.
Real labor income is given by ________
A) MPL × L B) labor share of income × labor productivity × labor C) labor share of income × output D) all of the above E) none of the above
The value of money falls as the price level
a. rises, because the number of dollars needed to buy a representative basket of goods rises. b. rises, because the number of dollars needed to buy a representative basket of goods falls. c. falls, because the number of dollars needed to buy a representative basket of goods rises. d. falls, because the number of dollars needed to buy a representative basket of goods falls.