Macroeconomics
13th Edition
ISBN: 9781337617390
Author: Roger A. Arnold
Publisher: Cengage Learning
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Chapter 19.6, Problem 2ST
To determine
Effects of money transfer of special interest legislation.
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Under the most recent tax reform act, Congress doubled the exemption for the estate tax while retaining the gift tax rules. Proponents of the estate tax says it allows the wealthy to create multi - generational wealth which does not benefit the country economically. They also argue that it creates family empires. Opponents of the estate tax claim that paying the estate tax causes many families to have to sell family businesses in order to pay the estate tax and that in most cases taxes have already been paid on the accumulated wealth that is being passed on. Describe your position on the estate tax and why it should be maintained, increased, decreased or eliminated according to your beliefs.
9) Since the Social Security system began in 1935, the
number of individuals in the workforce per retiree
(ratio of workers supporting those receiving retirement
benefits) has
A) stayed roughly the same.
B) continually increased.
C) continually decreased.
D) risen and declined with different generations.
5. As a hypothetical case, suppose the typical individual has a
utility function expressed as U = (C – 50)*(L – 10), where C
is consumption and L is leisure time. The current wage, w, is
$5 and she has a weekly return on assets of V = $100. She
only has 60 hours per week to divide between work hours, h,
and Leisure. A number of countries and communities are
considering implementing a "Guaranteed Basic Income" as
policy. A "Guaranteed Basic Income" is a government
payment of a fixed a amount of money for each person
Suppose the country of interest sets the weekly payment at
$100.
i) Using the Neo-classical labor supply with reference to
specific numerical values discuss the consequences of the
above "Guaranteed Basic Income".
ii) Using the basic Supply and Demand for labor approach
discuss the consequences of the "Guaranteed Basic
Income" policy on the overall labor market.
iii) Using a feedback approach, from the Neo-classical labor
supply to market equilibrium and back to labor…
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