Nolivia Is a Small and Poor Nation, but Its Current

question 101

Multiple Choice

Nolivia is a small and poor nation, but its current president has a genuine desire to create more wealth for Nolivia citizens. The president has received recommendations from several of her advisors. Which of the following recommendations is likely to create the most wealth for Nolivia?

• A)Acquire more land by invading a neighboring country that is even poorer and weaker than Nolivia.
• B) Use foreign aid from other nations to purchase more tools and machinery.
• C)Establish a business environment that promotes and rewards entrepreneurship.
• D)Establish barriers to trade to protect Nolivia businesses from foreign competition.

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Definitions:

Wages

Compensation received by employees for services performed. Usually, wages are computed by multiplying an hourly pay rate by the number of hours worked.

Tips

Gratuity given voluntarily by customers in exchange for a service, often subject to specific reporting and taxation rules.

Preparer Tax Identification Number

A unique identification number that all paid tax return preparers must use on U.S. federal tax returns or claims for tax refunds submitted to the IRS.

Marginal Tax Rate

The rate at which the last dollar of a taxpayer's income is taxed, indicating the rate of tax applied to your highest level of income.