Taxes cause deadweight losses because they
a. lead to losses in surplus for consumers and for producers that, when taken together, exceed tax revenue collected by the government.
b. distort incentives to both buyers and sellers.
c. prevent buyers and sellers from realizing some of the gains from trade.
d. All of the above are correct.
d
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Burger Queen enjoyed $1 million in profits last year. What does Burger Queen's $1 million in profits mean for its competitor, Burger Lord?
A) Nothing. B) Burger Lord must have suffered $1 million in losses last year. C) Burger Lord must have also enjoyed $1 million in profits last year. D) Burger Queen is more efficient at serving its customers compared to Burger Lord.
If freezing weather destroys half of the current Florida orange crop, wealth will increase for
A) almost all Florida orange growers. B) no Florida orange growers. C) some Florida orange growers and all California orange growers. D) some Florida orange growers and some California orange growers.
Can a firm achieve technological efficiency without achieving economic efficiency?
What will be an ideal response?
Suppose the number of Euros per U.S. dollar is 1.5, the aggregate price level in Europe is 100, and the real exchange rate between the two countries is 1 . The aggregate price level in the United States is _____
a. 66.67 b. 75.57 c. 50.58 d. 60.68