In a proportional tax system, ________.
A) the average tax rate faced by an individual exceeds the marginal tax rate
B) the marginal tax rate faced by an individual exceeds the average tax rate
C) the average tax rate equals the marginal tax rate
D) the marginal tax rate faced by all households are equal
Question 2
Suevania opens its doors to trade with Barvania. Barvania has a comparative advantage in the production of machinery. Hence, once trade occurs, Suevania's consumers will buy ________ machinery and pay ________ before.
A) more; a higher price than
B) more; a lower price than
C) less; a higher price than
D) less; a lower price than
E) the same amount of; the same price as