The consumer-side deadweight loss from a per-unit tax in the goods market arises from solely from the fact that output falls under the tax.
Answer the following statement true (T) or false (F)
False
Rationale: When goods are perfect complements, there is no deadweight loss on the consumer side despite the fact that output falls under the tax.
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What will be an ideal response?
Economic models can help us understand reality only when they include all details of the economy
a. True b. False Indicate whether the statement is true or false
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What will be an ideal response?
Refer to the information provided in Figure 26.6 below to answer the question(s) that follow.
Figure 26.6Refer to Figure 26.6. Suppose the equilibrium output is initially $600 billion. A decrease in the Z factors ________ equilibrium output and ________ the price level.
A. decreases; leaves unchanged B. increases; increases C. leaves unchanged; increases D. increases; decreases