If General Tax Revenues Were Used to Subsidize Production of Toothpicks

question 68

Multiple Choice

If general tax revenues were used to subsidize production of toothpicks, the government's actions would have

• A)widespread benefits and costs
• B)widespread costs and concentrated benefits
• C)concentrated benefits and costs
• D)widespread benefits and concentrated costs
• E)widespread benefits and either widespread or concentrated costs

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Definitions:

Face Value

The face value or amount in dollars indicated on a financial security, such as a bond or note, which is the total that will be paid out when it matures.

Yield to Maturity

The expected overall yield of a bond, assuming it is retained until its maturity date, comprising of both interest earnings and profits from capital appreciation.

Coupon Rate

Yearly interest percentage on a bond, calculated against its nominal value.

At Par

Refers to a financial instrument (e.g., bond or stock) being traded at its face value.