For each level of government (federal, state and local) list the most important source of tax revenue
What will be an ideal response?
For the federal government, the most important source of revenue is the income tax. For state governments, the most important source of revenue is general sales taxes. For local governments, the most important source of revenue is the property tax.
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Will a profit-maximizing monopolist who is not subject to government regulation produce a quantity where the MR < 0?
What will be an ideal response?
Typical goals for fiscal policy are
A) running high deficits and raising consumer prices. B) high prices for consumers and low prices for businesses. C) high employment and price stability. D) increasing the money supply so the government can spend more.
Which of the following situations is NOT possible?
A) SAC and LAC are both increasing for some output levels. B) SAC is increasing but LAC is decreasing for some output levels. C) SAC is decreasing but LAC is increasing for some output levels. D) SAC and LAC are both decreasing for some output levels. E) All of the above are possible.
Politicians will often be able to gain from support of trade restrictions because
A) the restrictions will lead to lower prices and substantial benefits for consumer groups. B) the restrictions will generate substantial benefits for consumer groups at the expense of well-organized labor and industrial interests. C) organized interest groups benefiting from the restrictions will make large contributions to political campaigns while most others will not feel strongly about the restrictions. D) foreigners benefiting from the restrictions will be a major source of political contributions.