Because workers tend to work more when their after-tax wage increases, the government can increase tax revenue by cutting taxes.
?
Answer the following statement true (T) or false (F)
False
Rationale: The combination of substitution and wealth effects leading workers to work more when their after-tax wage increases is NOT sufficient for the government to increase tax revenue by cutting taxes. This is because substitution effects in the labor market suggest that workers will work less as wage taxes increase, so they will pay less in additional tax revenues, and tax revenue will decrease, not increase.
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Which of the following can be a barrier to entry?
i. ownership of a necessary input ii. requiring a government license iii. large diseconomies of scale A) i only B) ii only C) i and iii D) i and ii E) i, ii, and iii
If the equation of exchange holds, and if the velocity of money and total output are fixed, then, if the money supply doubles,
A) the price level will increase by half. B) the price level will decrease by half. C) the price level will double. D) the price level will decrease by 25 percent.
Economists believe that the same explanation for the rapid growth of costs applies to services, theatrical performances and restaurant meals
a. True b. False Indicate whether the statement is true or false
Last year Christine worked as a consultant. She hired an administrative assistant for $15,000 per year and rented office space (utilities included) for $3,000 per month. Her total revenue for the year was $100,000. If Christine hadn't worked as a consultant, she would have worked at a real estate firm earning $40,000 a year.For Christine to earn a normal profit as a consultant, her accounting profit would have to be ________.
A. $9,000 B. $0 C. $51,000 D. $40,000