Which position would Adam Smith most likely support during a congressional debate on tax reform?

Income taxes should be decreased to the same rate for everyone.

Income taxes should be abolished and replaced with a national sales tax.

Income taxes should be increased regardless of ability to pay.

Income taxes should be reduced to a minimal level and be based on ability to pay.

Question 14

(05.06 MC)

Which of these would result from high inflation in the United States?

U.S. goods would be less expensive than before.

Americans would demand higher wages.

Income levels in the workforce would fall.

The Consumer Price Index would be a negative number.

Question 15

(05.02 LC)

The government determines prices for goods and services in a

market economy

traditional economy

demand economy

command economy

Question 16

(05.05 MC)

The governments of the United States, Mexico, and Canada created the North American Free Trade Agreement in order to

remove barriers to trading products between the three countries

increase the prices on products common to all three countries

prevent each of the three from trading with other countries

decrease growth in South America's developing countries

Question 17

(05.03 LC)

Which of the following economic goals focuses on equal opportunities for education?

Equity

Freedom

Growth

Security

Question 18

(05.05 MC)

The U.S. government wants to restrict Nation A's access to weapons-making materials. Which of the following actions will it most likely take?

Establish a free-trade zone with Nation A

Impose tariffs on certain goods imported from Nation A

Institute an embargo on trade in certain items with Nation A

Place a quota on certain types of goods Nation A can export