Economists regard expenditures on education as investments because:
A. they are subject to tax deductions at the same rate as are expenditures on machinery and
equipment.
B. education is economically beneficial at the same time it is being acquired.
C. such expenditures are current costs that are intended to enhance future earnings.
D. they differ from expenditures on health and worker mobility.
Answer: C
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In the steady state of the Solow growth model
A) consumption equals depreciation. B) per capita variables grow at the rate of population growth. C) aggregate consumption grows at a constant rate. D) aggregate output is constant.
Mergers are closely scrutinized by the government because
A) they might allow the firms involved to dominate the market and act as a legalized cartel (monopoly). B) they always result in a more efficient market. C) they always result in lower joint profits of the firms involved. D) all mergers are undesirable.