Edgar Browning and William Johnson, in a paper published in the Journal of Political Economy (1984), presented evidence that a one-dollar transfer to the bottom 40 percent of income distribution costs the top 60 percent nine dollars. If correct, this finding proves
A. the tax system is generating significant excess burdens.
B. these transfers are not worth the cost.
C. loopholes have to be closed.
D. the burden of the tax system is too great.
Answer: A
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If total fixed cost increases, which of the following will NOT change?
A) total cost B) average fixed cost C) marginal cost D) average total cost E) ALL costs increase when total fixed cost increases.
By 1937, when a new recession began in the midst of the Great Depression,
A) GDP had almost recovered to its 1929 level, but unemployment was still above the 1929 level. B) unemployment had almost fallen back to its 1929 level, but GDP had yet to recover to its 1929 level. C) neither GDP nor unemployment had returned to near their 1929 levels. D) both GDP and unemployment had returned to near their 1929 levels.