Homer earns $10,000 per year. Each year he spends $5,000 and saves $5,000. He pays a 5 percent sales tax on all of his spending. Assuming the sales tax is the only tax he pays, his average tax rate out of his income is

Shama is producing candles in a perfectly competitive market. When she produces 500 candles, her total cost is $250. If she produces one additional candle, her total cost increases to $260

In order to maximize her profit, she should produce the additional candle A) if the market price for a candle is $12. B) only if the market price exceeds $260 for a candle. C) only if the market price exceeds $250 for a candle. D) if the market price for a candle exceeds $0.50. E) if her price exceeds her average total cost.

Suppose that consumption spending is $4,200 billion, spending on durable goods is $1,200 billion, and spending on services is $2,000 billion. What does spending on nondurable goods equal?

A) $7,200 billion B) $1,000 billion C) $2,200 billion D) $3,200 billion E) There is not enough information to answer this question.