FAMU Economics Exam 1 Questions And Answers With Latest Updates
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Course
FAMU Economics
Institution
FAMU Economics
The ability-to-pay principle (of taxation) - ️️belief that taxes should be paid
according to level of income regardless of benefits received
The benefits-received principle - ️️system of taxation in which those who use a
particular government service support it with taxes in proportion t...
FAMU Economics Exam 1
The ability-to-pay principle (of taxation) - ✔️✔️belief that taxes should be paid
according to level of income regardless of benefits received
The benefits-received principle - ✔️✔️system of taxation in which those who use a
particular government service support it with taxes in proportion to the benefit they
receive; those who do not use a service do not pay taxes for it
formula to calculate the tax rate - ✔️✔️Tax Rate=Tax Liability / Taxable Income
quantity demanded - ✔️✔️the amount of a good that buyers are willing and able to
purchase
demand curve - ✔️✔️a graph of the relationship between the price of a good and the
quantity demanded
demand schedule - ✔️✔️a table that shows the relationship between the price of a
good and the quantity demanded
Economists say that making choices involves comparing....
a. Excess costs and excess benefits
b. Desires and capabilities
c. Individuals' wants and society's wants
d. Marginal costs and marginal benefits
e. All of the above - ✔️✔️marginal costs and marginal benefits
sunk cost - ✔️✔️a cost that has already been paid and cannot be recovered
PPF (Production Possibilities Frontier) - ✔️✔️a curve that shows the maximum quantity
of one good that can be produced for each possible quantity of another good produced
Externailities - ✔️✔️the cost of benefit that affects a party who did not choose to incur
that cost or benefit
law of demand - ✔️✔️the quantity demanded of a good falls when the price of the good
rises
income effect - ✔️✔️the change in consumption resulting from a change in real income
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