This topic contains a solution. Click here to go to the answer

Author Question: Which of the following transactions would take place in the underground economy? A) Matt bought ... (Read 138 times)

Charlie

  • Hero Member
  • *****
  • Posts: 640
Which of the following transactions would take place in the underground economy?
 
  A) Matt bought an iPad for 499 but decided to sell it on eBay instead of keeping it.
  B) Elizabeth tells her mother she's going to work but really goes to see a movie.
  C) Paul buys 15 gallons of gasoline for 3.29 a gallon, not realizing that 1.50 per gallon of that price goes to the government as tax revenue.
  D) John makes chain-link belts and necklaces and sells them at a local flea market for cash to avoid paying taxes.

Question 2

If banks pay deposit insurance premiums to the Federal Deposit Insurance Corporation that are less than the amount that they would have to pay if the insurance were privately provided
 
  what kind of behavioral problem might this cause on the part of banks?



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

SeanoH09

  • Sr. Member
  • ****
  • Posts: 323
Answer to Question 1

D

Answer to Question 2

It is likely to cause banks to be less careful with their depositors' money than they otherwise would be if the true cost of their risky loan-making were born by them rather than the government.




Charlie

  • Member
  • Posts: 640
Reply 2 on: Jun 29, 2018
Excellent


ASDFGJLO

  • Member
  • Posts: 335
Reply 3 on: Yesterday
Gracias!

 

Did you know?

The human body's pharmacokinetics are quite varied. Our hair holds onto drugs longer than our urine, blood, or saliva. For example, alcohol can be detected in the hair for up to 90 days after it was consumed. The same is true for marijuana, cocaine, ecstasy, heroin, methamphetamine, and nicotine.

Did you know?

Malaria was not eliminated in the United States until 1951. The term eliminated means that no new cases arise in a country for 3 years.

Did you know?

As of mid-2016, 18.2 million people were receiving advanced retroviral therapy (ART) worldwide. This represents between 43–50% of the 34–39.8 million people living with HIV.

Did you know?

Certain topical medications such as clotrimazole and betamethasone are not approved for use in children younger than 12 years of age. They must be used very cautiously, as directed by a doctor, to treat any child. Children have a much greater response to topical steroid medications.

Did you know?

Liver spots have nothing whatsoever to do with the liver. They are a type of freckles commonly seen in older adults who have been out in the sun without sufficient sunscreen.

For a complete list of videos, visit our video library