In analyzing the gasoline tax and subsidy policy discussed in the text, the final solution illustrates that
A. the government is made better off financially.
B. consumers do not cut back on fuel consumption.
C. consumers are worse off than they were before the policy began.
D. social welfare increases.
Answer: C
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A double coincidence of wants problem can be overcome by
A) commodity money. B) fiat money. C) banks. D) all of the above.
To answer, refer to the following: "Ford built 18 vehicles per auto employee in North America last year, while GM could only manage 12." (The Wall Street Journal) In comparison with GM, Ford had
A. higher total variable cost. B. higher average variable cost. C. lower average variable cost. D. both a and c E. none of the above
When government imposes a per-unit tax on a product, the net price producers actually receive for the product (after taxation) typically:
A. decreases by the amount of the per-unit tax. B. increases by less than the amount of the per-unit tax. C. increases by the amount of the per-unit tax. D. decreases by less than the amount of the per-unit tax.
Holding other factors constant, an incline in the price of new capital goods will:
A. decrease investment. B. decrease national saving. C. increase investment. D. increase national saving.