An excise tax on gasoline causes
A. the market clearing price of gasoline to rise.
B. supply of gasoline to shift to the left.
C. a reduction in the quantity of gasoline demanded.
D. All of these are correct.
Answer: D
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Economics:
a. is a narrowly focused discipline.
b. is a broad-ranging discipline.
c. concerns itself only with the U.S. economy.
d. says little about "everyday life."
e. deals with minor problems.
The above figure shows the marginal social benefit and marginal social cost curves of coffee in the nation of Kaffenia. Which of the following would result in the quantity of coffee in Kaffenia differing from the efficient quantity?
A) The existence of a single producer and seller of coffee. B) The existence of many producers and sellers of coffee. C) Damage to the environment from fumes emitted by coffee beans. D) Both answers A and C are correct.
Refer to Figure 11-2. Based on the per-worker production function above, if the economy raises capital per hour worked from $35,000 to $40,000, by how much will real GDP per hour worked increase?
A) $150 B) $1,850 C) $2,000 D) $5,000
If income and the prices of both goods all double, the budget line will
a. become flatter b. become steeper c. remain unchanged d. experience a parallel outward shift e. experience a parallel inward shift