What is the meaning of the incidence of a tax? Give an example using a landlord and tenants
What will be an ideal response?
The incidence of a tax refers to who bears the actual burden or cost of the tax. If it is not the taxpayer who pays the tax to the government, then the burden of the tax is said to be “shifted” onto another individual. For example, the landlord is the taxpayer who sends in the property tax money to the state or local government, but the incidence is probably shifted onto the tenant who finds that the rent has been raised to cover the cost of the property tax.
You might also like to view...
Use the following table with data for a private (no government) closed economy to answer the next question. All figures are in billions of dollars.Domestic Output or Income (RGDP = DI)Consumption$540$540560555580570600585620600640615660630If planned investment is $25 billion, then aggregate expenditures at the income level of $560 billion will be
A. $565 billion. B. $585 billion. C. $580 billion. D. $595 billion.
A saver can eliminate _______ risk through ________________.
A. systemic; diversification B. idiosyncratic; diversification C. systemic; asset valuation D. idiosyncratic; asset valuation
Monetary policy has no ________.
A. implementation lag B. legislative lag C. multiplier lag D. recognition lag
Monetary policy is only effective in a country with floating exchange rates when capital is highly mobile.
Answer the following statement true (T) or false (F)