When a tax is levied on buyers of a good,
a. government collects too little revenue to justify the tax if the equilibrium quantity of the good decreases as a result of the tax.
b. there is an increase in the quantity of the good supplied.
c. a wedge is placed between the price buyers pay and the price sellers effectively receive.
d. the effective price to buyers decreases because the demand curve shifts leftward.
c
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Refer to the figure above. Quota rents equal
A) $2000. B) $5000. C) $6000. D) $10000.
Today U.S. protectionism is concentrated in
A) high-tech industries. B) labor-intensive industries. C) industries in which Japan has a comparative advantage. D) computer intensive industries. E) capital-intensive industries.
A relatively flat aggregate demand curve indicates that
A) velocity is relatively constant. B) the economy is near full employment. C) inflation is relatively low. D) spending is sensitive to changes in the price level.
When the Fed buys U.S. government securities, the money supply
A) increases because there is an increase in transaction deposits at the bank of the bond dealer but there is no decrease in transaction deposits at any other bank. B) decreases because there is an increase in the reserves of the bond dealer's bank. C) remains unchanged because the increase in transaction deposits at the bond dealer's bank is offset by a reduction in transaction deposits at the Fed. D) remains unchanged because the increase in transaction deposits at the bond dealer's bank is offset by a fall in transaction deposits at another bank.