Question
9. The case for tax breaks for investment rests on the claim that because of big spillover effects, the return on investment in machinery and
9. "The case for tax breaks for investment rests on the claim that because of big spillover effects, the return on investment in machinery and equipment to the economy as a whole is far greater than ........" Complete this clipping.
a) the inflation created by this policy b) the return to consumers from saving
c) the return to the businesses doing the investing
d) the incentives to avoid the tax
10. "A popular view is that the best way for governments to stimulate growth is to improve the functioning of markets and adopt stable and credible macroeconomic policies which encourage firms to take a long-term view. The trouble with this view is that governments, like voters, are more interested in ............" Complete this clipping.
a) the short run b) inflation and unemployment
c) smoothing the business cycle d) all of the above
11. "Countries with a high level of education tend to absorb new technology more quickly and therefore grow more quickly. But one problem is that firms and workers cannot capture the external benefits from investing in education, which means that they ................" Complete this clipping.
a) cause higher unemployment b) invest too much in education
c) do not invest enough in education d) demand unrealistic wages and prices 37
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