Taxing people according to their marginal valuations of a public good may be efficient, but it may not be fair if the ability to pay differs
a. True
b. False
A
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In a market economy, ________ interact in markets to decide the answers to the fundamental economic questions
A) the judicial and legislative branches of the federal government B) large corporations C) households and firms D) state and local governments
According to a study by Thomas Cooley and Gary Hansen, the cost in lost consumption of a 10% per annum rate of inflation is
A) negative. B) approximately 0.001%. C) approximately 0.5%. D) approximately 5.0%.
Assume that consumption spending is equal to $600, government spending is $100 billion, and GDP is $800 billion. If net exports are equal to zero, investment spending must be
A) $700 billion. B) $600 billion. C) $500 billion. D) $100 billion.
When demand is unit elastic, price elasticity of demand equals
a. 1, and total revenue and price move in the same direction. b. 1, and total revenue and price move in opposite directions. c. 1, and total revenue does not change when price changes. d. 0, and total revenue does not change when price changes.