In the above figure, if the real interest rate is 8, there is
A) underproduction in this economy.
B) a surplus of loanable funds.
C) a shortage of loanable funds.
D) a shortage in available funds for investment.
B
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Which of the following statements is true?
A) Marginal analysis is a key component in the process of optimization in levels. B) Only direct costs are considered when the net benefits of the alternatives are calculated. C) In both the techniques of optimization, all costs have to be converted to the same unit of measurement. D) Optimization in levels calculates the change in net benefits when a person switches from one alternative to another.
An income tax in which the average tax rate increases with income is called a
A) regressive income tax. B) proportional income tax. C) flat-rate income tax. D) progressive income tax.