Provide two justifications for not taxing unrealized capital gains
What will be an ideal response?
One justification for not taxing unrealized capital gains is based on equity. If individuals are taxed on unrealized capital gains and an asset significantly appreciates an individual might have to sell the asset in order to pay the tax. From an equity standpoint, this appears to be government confiscation. Another justification for not taxing unrealized capital gains is on the grounds that it is often difficult to accurately assess the value of certain assets until they are exchanged in a market transaction. Certainly taxing unrealized capital gains will increase disputes between government and individuals on the valuation of assets.
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Discount policy affects the money supply by affecting the volume of ________ and the ________
A) excess reserves; monetary base B) borrowed reserves; monetary base C) excess reserves; money multiplier D) borrowed reserves; money multiplier
When the price of a textbook is $100, 60 copies are demanded; and when the price of that textbook goes up to $120, 30 copies are demanded. In the price range between $100 and $120, the demand for the textbook is
A) elastic. B) inelastic. C) unit elastic. D) perfectly elastic.