Suppose that in a certain nation the flat income tax rate of 40 percent is reduced to 35 percent and as a result the tax base falls from $400 billion to $375 billion. As a result, tax revenues __________, indicating the nation is on the __________ portion of its Laffer curve
A) rise; upward-sloping
B) rise; downward-sloping
C) fall; upward-sloping
D) fall; downward-sloping
C
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Refer to the scenario above. Pat should submit a bid of ________
A) $200 B) $180 C) $45 D) $135
If a decrease in the growth rate of AD leads to a decrease in real GDP in the short run: a. the decrease in AD could have been correctly anticipated
b. the decrease in AD could have been than anticipated c. the decrease in AD would have been completely unanticipated. d. the decrease in AD could have been any of the above.
If a country changes its corporate tax laws so that domestic businesses build and manage more business in other countries, then the net capital outflow of that country
a. and the net capital outflow of other countries rise. b. rises and the net capital outflow of other countries fall. c. falls and the net capital outflow of other countries rise. d. None of the above are correct.
The L in OLI theory stands for loyalty, and this factor makes it more difficult for firms to substitute foreign operations for domestic as they fear a loss of sales due to negative publicity
Indicate whether the statement is true or false