Which of the following is an efficiency argument against the welfare state?
a. High marginal tax rates create large disincentives to work and lower overall production.
b. It is fairer to tax those with higher incomes than those with lower incomes.
c. The government has no right to force those with higher incomes to pay more taxes than those with lower incomes.
d. Principles of social justice argue that society should take care of the poor.
Ans: a. High marginal tax rates create large disincentives to work and lower overall production.
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Refer to the scenario above. The future value of the initial deposit after one year is:
A) $300. B) $1,000. C) $1,300. D) $2,300.
Suppose that the consumer price index (CPI) was 160 in 2010 and 166 in 2011, inflation during 2011 was
a. zero; prices were stable. b. 3.8 percent. c. 6 percent. d. 66 percent.