With a proportional tax, higher-income persons will pay
A. a higher proportion of their income in taxes than lower-income persons.
B. the same amount of taxes as lower-income persons.
C. a higher marginal tax rate as their incomes rise.
D. a bigger amount in taxes compared to lower-income persons.
Answer: D
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Imports are goods and services that are produced:
A. and consumed in other countries. B. in other countries and consumed domestically. C. and consumed domestically. D. domestically and consumed in other countries.
To induce an agent to work hard, a principal may offer the agent a bonus, in other words, an extra payment if a performance target is hit
Suppose that the agent's performance is affected by factors beyond the agent's control, for example umbrellas are demanded more on a rainy day. Under what conditions may the bonus not induce the agent to work harder? A) The agent is very risk averse. B) The agent is very risk loving. C) The agent is risk neutral. D) The principal is risk neutral.
If a 10 percent increase in price causes a 5 percent increase in quantity supplied, then supply is
A) elastic. B) inelastic. C) unit elastic. D) infinite.
The trade-offs in the effect of unemployment insurance are:
A. it prolongs the job search, but reduces the number of job searches a person has to make. B. it shortens the job search, but lengthens the number of times a person will switch careers. C. it is free money and makes people lazy, but without it people would starve. D. it reduces incentive to accept a job, but reduces the number of job offers typically made.