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Suppose that more expansionary monetary policy leads to inflation and higher nominal interest rates. How is this likely to affect the value of stocks? Explain.
What do you think is the best plan that will provide high returns at a relatively low risk? What answer would you give? Explain.
What are the advantages and disadvantages of a private option system? If given the opportunity, would you choose private option or stay with the current system?
Why does the Social Security system face a crisis? Are there real assets in the Social Security Trust Fund that can be used to pay future benefits?
How are human and physical capital investment decisions similar? How do they differ? What determines the profitability of a physical capital investment?
In which occupation will the hourly wage rate be highest? Why? In which occupation will the annual wage be highest? Why?
Why are the incomes of some workers high and others low? Do you think the market system of wage determination is fair? Why or why not?
If you take the program, you will have to borrow the funds at 8 percent rate of interest. From a strictly monetary viewpoint, should you enroll in the program?
Discuss what is the present value of the ticket when the appropriate rate for discounting the future income is thought to be 10 percent?
Why will the investment be a profitable undertaking? Is the project profitable at an interest rate of 12 percent? Provide calculation in support of your answer.
If the money rate of interest on a low-risk government bond is 10 percent and the inflation rate. What is the estimated real rate of interest?
Why do you think the credit card rate is so high? Should the government impose an interest rate ceiling of, say, 10 percent?
Over long periods of time, the rate of return of an average investment in the stock market. Why is the higher return on stocks surprising? Why or why not?
Discuss what makes an investment profitable? Do profitable investments create wealth? Why or why not? Do all investments create wealth? Discuss.
Would this affect your employment? How might you minimize the personal effects of this tax?
If she accepts job, she will be liable for employment taxes of $56 per month and lose transfer benefits. What is Sue's implicit marginal tax rate for this job?
Is annual money income a good measure of economic status? Is the standard of living of the $80,000 family twice as high as that of the $40,000 family? Discuss.
What effect does the Internet have on the efficiency of markets? Explain. How is the Internet likely to influence productivity and the growth of output?
Do you think the increase in the number of people who pay no taxes will affect the efficiency of the political process? Why or why not?
What was the top marginal personal income tax rate in 1980? What is the top rate now? Are you in favor of or opposed to the lower marginal rates? Why?
Discuss How do taxes influence the efficiency of resource use? How much does it cost for the government to raise an additional dollar of tax revenue?
As income transfer programs accompanying the War on Poverty increased beginning in the latter half of the 1960s, what happened to the poverty rate?
Using this example, discuss whether the fairness of the process or the fairness of the outcome is more important, and how they differ.
What would happen as a result to the average quality of automobiles if the proceeds of the tax were used to subsidize a government-operated lottery?
What determines the variety of styles, designs, and sizes of different products? Why do you think there are only a few different varieties of toothpicks?