The incidence of a tax:
A. falls entirely on suppliers if supply is perfectly elastic.
B. falls entirely on suppliers if demand is perfectly inelastic.
C. falls entirely on consumers if supply is perfectly elastic.
D. falls entirely on consumers if demand is perfectly elastic.
C. falls entirely on consumers if supply is perfectly elastic.
You might also like to view...
The term externalities refers to
A) consequences of action not taken into account in making decisions. B) social interactions associated with urban-industrial economies. C) the superficial consequences of decisions. D) the visible consequences of decisions.
Arbitrage
a. Is the act of to buying low in one market and selling high in another market b. Can force a seller to go back to uniform pricing c. Can defeat direct price discrimination d. All of the above
Assume a perfectly competitive firm is producing a level of output at which MR? < MC. What should the firm do to maximize its? profits?
A) The firm should do nothing — it wants to maximize the difference between MR and MC in order to maximize its profits.
B) The firm should decrease output.
C) The firm should increase price.
D) The firm should increase output.
If the cross-price elasticity of salt and pepper is positive the goods must be complements.
Answer the following statement true (T) or false (F)