Suppose an excise tax is imposed on luxury boats and yachts. Economists argue that such a tax
a. is sure to be vertically equitable, since buyers of luxury boats and yachts are wealthy.
b. entails no deadweight loss as long as buyers of boats and yachts can easily substitute one luxury good for another.
c. violates the benefits principle of taxation.
d. may burden workers in the luxury-boat-and-yacht industry more than it burdens the buyers of luxury boats and yachts.
d
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Normal profit is
A) part of the firm's opportunity costs. B) the same as economic profits. C) part of the firm's explicit costs. D) Answers A and B are correct. E) Answers A and C are correct.
A market in which firms can enter if they choose and exit without losing money invested is
A. pure monopoly. B. duopoly. C. contestable. D. a market where there are kinked demand curves.
When services are provided and financed by local rather than higher levels of government and people can move freely among governmental units,
A) local governments will be in a strong position to exploit various groups of voters. B) a local government will always be able to generate more revenues by raising taxes. C) competition among governmental units will help residents get more for their tax dollars. D) there will be less incentive for government officials to operate efficiently than if there was only one centralized government.
In the acronym SPENT, what does the “S” stand for?
a. change in seller’s output prices b. change in shortages c. change in seller’s input prices d. change in surplus