A subsidy is similar to a reverse tax—instead of taking money away from buyers (or sellers), the government gives money back to buyers (or sellers).

In the figure above, the shift in the supply of loanable funds curve from SLF1 to SLF2 could be the result of

A) an increase in expected rate of profit. B) a decrease in disposable income. C) an increase in expected future disposable income. D) an increase in the real interest rate. E) a decrease in wealth

A needed reform in the U.S. income tax system that would reduce the costs of inflation is to

A) go back to taxing nominal wage and salary income. B) start taxing real wage and salary income. C) go back to taxing nominal interest income. D) tax real interest income.