Which of the following is true of taxes?
What will be an ideal response?
Taxes drive a wedge between what buyers pay and what sellers receive
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The supply curve for labor in a purely competitive market slopes upward because
A. the wage rate paid to workers falls as more are hired. B. marginal resource cost rises as productivity increases. C. the marginal product of labor falls as output increases. D. higher wages must be paid to bid workers away from other opportunities.
The steps in the transmission of monetary policy are
A) Congress increases government expenditures on goods and services, leading to an increase in aggregate demand. B) Congress increases the money supply, which lowers the interest rate, and leads to an increase in aggregate demand. C) the Federal Reserve increases government expenditures on goods and services, leading to an increase in aggregate demand. D) the Federal Reserve lowers the federal funds rate, which lowers the real interest rate and leads to an increase in aggregate demand. E) Congress increases the budget deficit, which increases the money supply, which increases aggregate supply.
If the government implements a price ceiling on insulin, this will
A) decrease the quantity of insulin the manufacturers will be willing to supply. B) encourage manufacturers to produce and sell more insulin to increase their profits. C) have to be set above the market equilibrium price to be effective. D) increase the price consumers will pay for insulin.
Explain the functioning and significance of vertical agreements. Use specific examples from the apparel and textile markets