Mr and Mrs

question 71

Multiple Choice

Mr. and Mrs. Jelk file a joint return. They provide 65% of the financial support for David, the 14-year old son of a friend who died three years ago. David lives in the home of his aunt Sarah, who provides 35% of his financial support. Which of the following statements is true?

• A) David is a qualifying child of the Jelks.
• B) If David earns less than $4,000 gross income this year, he is a qualifying child of the Jelks.
• C) If David earns less than $4,000 gross income this year, he is a qualifying relative of the Jelks.
• D) David is neither a qualifying child nor a qualifying relative of the Jelks.

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Definitions:

Supply-Side Economics

Main tenets: economic role of federal government is too large; high tax rates and government regulations hurt the incentives of individuals and business firms to produce goods and services.

Systematic Error

refers to a consistent, predictable error present in the results of measurements or experiments due to flaw in the measurement system.

Rational Expectations

A theory in economics suggesting that individuals make decisions based on their rational outlook, available information, and past experiences.

Adaptive Expectations

A theory in economics that expectations of future events are constructed based on past events and that agents adjust slower to new information.