Refer to the above figure. A unit tax has been placed on the good. The consumer pays what amount of the tax?
A. none of the tax
B. P2 - P1
C. P1 - P0
D. P2 - P0
Answer: B
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The natural rate hypothesis concludes that when the inflation rate increases, then in the long run there is
A) an upward movement along the short-run Phillips curve. B) an upward shift of the short-run Phillips curve. C) a downward shift of the short-run Phillips curve. D) no change at all in the short-run Phillips curve. E) a downward movement along the short-run Phillips curve.
Development economics is the study of the
a. alleviation of absolute poverty. b. transformation of institutions. c. allocation of resources in developing countries. d. all of the above.
When actual inflation is greater than expected inflation
A) the natural rate of unemployment rises, according to Phillips-curve analysis. B) cyclical unemployment rises, according to Phillips-curve analysis. C) there are transfers from borrowers to lenders. D) there are transfers from lenders to borrowers.
Technological spillover ________
A) is made possible by the nonrivalry of ideas B) generates an increase in both capital and labor C) is caused by population growth D) is caused by population decline