If the government needs to raise revenue to pay for a public good, the ideal tax structure would tax
A. only citizens who state that they will use the public good.
B. all citizens in proportion to their willingness to pay for the public good.
C. all citizens by the same proportion of their income.
D. all citizens by the same amount.
Answer: B
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Today, the dollar is worth 1.15 euros. Due to changes in economic conditions, people expect that the dollar will be worth 1.20 euros in the next month. This belief
A) increases the demand for dollars. B) decreases the demand for dollars. C) increases the demand for euros. D) increases the value of exports to Europe.
When the price of raisins falls, the quantity of raisins demanded rises. Explain this change in terms of income and substitution effects
What will be an ideal response?
If velocity is constant and equal to 2, a $10 billion shift of the LM curve to the left will be produced by a __________ in the money supply
A) $5 billion increase B) $5 billion decrease C) $20 billion increase D) $20 billion decrease
Suppose in a democratic society, all voters prefer choice G over choice B; however, when the two choices are presented along with a third choice, R, B wins the election. This violates the assumption of
A) transitivity. B) non-dictatorship. C) independence of irrelevant alternatives. D) completeness.