The marginal ____ from reduced future warming is measured by the ___ value of crops
saved, floods avoided, and less air-conditioning needed.
A. cost; environmental
B. cost; dollar
C. benefit; environmental
D. benefit; dollar
Answer:
The price system is ___ system: the price of a product should convey ___.
A. a simple; its benefit
B. a complex; its benefit
C. an information; its benefit
D. an information; its cost
Answer:
Under a defined-benefit plan from the government, the worker will not receive a
retirement benefit if
A. the worker switches jobs.
B. the worker’s firm goes bankrupt.
C. the worker’s investments do poorly.
D. the government stops levying payroll taxes.
Answer:
If the inflation rate is 8%, the nominal interest rate 12%, and the individual’s tax rate
25%, then under U.S. tax rules, the individual’s real after-tax return is ____.
A. 1%
B. 2%
C. 3%
D. 4%
Answer:
To obtain a flat tax, start with a ___ on firms and no income tax on households; then
permit firms to deduct ______ but tax households at a single rate on _____ above an
exemption.
A. RST; interest and depreciation; income
B. VAT; interest and depreciation; income
C. RST; wage income; wage income
D. VAT; wage income; wage income
Answer:
According to the Actuary of the Social Security Administration, after 2040 payroll taxes
will be sufficient to fund ___ of scheduled benefits.
A. 40%
B. 55%
C. 70%
D. 100%
Answer:
The largest estates pay a tax of about ___%.
A. 1
B. 10
C. 40
D. 80
Answer:
If there is a 95% chance of a $1,000 medical cost and a 5% chance of a $61,000 cost,
then the expected cost is ___.
A. $1,000
B. $2,500
C. $4,000
D. $6,000
Answer:
Cost-benefit analysis ___ include the benefit of ___ a future catastrophe from global
warming.
A. can; avoiding
B. cannot; avoiding
C. can; having
D. cannot; having
Answer:
The payroll tax is ___.
A. a labor income tax
B. an income tax
C. a consumption tax
D. a progressive tax
Answer:
Scandinavian taxes are ___ of GDP.
A. 30%
B. 40%
C. 50%
D. 60%
Answer:
In the formula for the efficiency loss of a wage income tax, t is the ____.
A. average tax rate
B. marginal tax rate
C. lump-sum tax rate
D. progressive tax rate
Answer:
A subsidy to the consumers of a good shifts
A. up the demand curve.
B. down the demand curve.
C. up the supply curve.
D. down the supply curve.
Answer:
The distribution of the tax burden between suppliers and demanders depends on ___.
A. relative elasticities and who writes the check to the government
B. relative elasticities
C. who writes the check to the government
D. whether the tax is levied on the supplier or the demander
Answer:
The most important tax for local governments is the _____.
A. sales tax
B. income tax
C. property tax
D. payroll tax
Answer:
Revenue from the tax equals ___.
A. tWH
B. tW
C. tH
D. t2WH
Answer:
Under the U.S. household income tax, if the last $100 of wages of the first earner is
taxed 35%, a potential second earner would be taxed ___% on the first $100 earned.
A. 0
B. 10
C. 15
D. 35
Answer:
If profit is $55,000 in year 1 and $60,500 in year 2, then the present value of profit with
a 10% interest rate is ____.
A. $110,000
B. $105,500
C. $100,000
D. $95,000
Answer:
Starting from a workers support retirees system, switching to a self-sufficient system is
____ because workers must ____.
A. easy; save efficiently
B. hard; save efficiently
C. easy; double-save
D. hard; double-save
Answer:
One reason Stiglitz and Bilmes’s cost estimate is much higher than federal military
budget spending on Iraq is that they include the cost of the ____.
A. medical care and disability benefits to veterans
B. divisive national debate that has occurred over Iraq
C. distraction from problems in the U.S.
D. environmental damages in Iraq
Answer:
_____ sets spending and taxes, and ______ controls whether money is injected into the
economy.
A. Congress; the Federal Reserve
B. The Federal Reserve; Congress
C. Congress; Congress
D. The Federal Reserve; the Federal Reserve
Answer:
Under a private school system, a variable voucher plan would ____.
A. increase the quality gap between high and low-income children
B. decrease the quality gap between high and low-income children
C. increase admissions testing
D. decrease admissions testing
Answer:
Consider the following: a. skills and knowledge, b. how to learn, c. work ethic, d.
screening and sorting. Which of these do schools do?
A. a, b, and c
B. a and b
C. a
D. a, b, c, and d
Answer:
Your employer pays you $1,000. The income tax rate is 15%. The interest rate is 4%.
Refer to Table 9.2. Your retirement consumption under the W Tax (Roth IRA) is ____.
1. $850
2. $878.90
3. $884
4. $1,000
Answer:
An EITC reform that would encourage marriage would be to
A. increase the EITC phase-in rate.
B. reduce the EITC phase-out rate.
C. give a higher EITC for a third child.
D. raise the EITC of a married couple relative to single parents.
Answer:
What tax would induce citizens to unanimously vote for the socially optimal quantity of
the public good? Explain using a diagram.
Answer:
Explain how the EITC works and how it differs from welfare.
Answer:
Foreign investors hold ___ of U.S. Treasury debt held by the public.
Answer:
The percentages in the benefit formula set by Congress are _______.
Answer:
Today, the first word of the name of the U.S. federal welfare program is what?
Answer:
Show and explain the inefficiency of a subsidy for a good when there is no externality.
Answer: