Relative to a situation in which gasoline is not taxed, the imposition of a tax on gasoline causes the quantity of gasoline demanded to
a. decrease and the quantity of gasoline supplied to decrease.
b. decrease and the quantity of gasoline supplied to increase.
c. increase and the quantity of gasoline supplied to decrease.
d. increase and the quantity of gasoline supplied to increase.
a
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Fiscal drag refers to the
a. slowing effect on the economy that results from a government budget deficit. b. stimulating effect on the economy that results from a government budget deficit. c. stimulating effect on the economy that results from a government budget surplus. d. slowing effect on the economy that results from a government budget surplus.
In a barter system, we would see
A) many different units of money. B) money and goods exchanged for each other. C) wide-spread depository institutions. D) goods traded directly for other goods and services.
The owner of a perfectly competitive firm is currently earning an economic profit of zero. This owner
A) should shut down since profits of zero are not good. B) should raise the price of the product to increase profits. C) is covering all of his fixed costs. D) will continue producing in the short-run but will shut down in the long run if profits do not increase.
A copyright gives an inventor the exclusive right to make, sell, or use an invention for a limited time
a. True b. False Indicate whether the statement is true or false