If the federal government placed a 50 cent per pack excise tax on cigarette manufacturers, and if as a result, the price to consumers of a pack of cigarettes went up by 40 cents, the:
A. actual burden of this tax falls mostly on consumers.
B. actual burden of this tax falls mostly on manufacturers.
C. actual burden of the tax would be shared equally by producers and consumers.
D. tax would clearly be a progressive tax.
Answer: A
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Refer to the above figure. Corn is an input for producing Corn Flakes. Which diagram shows the effect on the supply of Corn Flakes when the price of corn has increased?
A) graph C B) graph D C) neither graph D) both graphs
The average product of labor increases as output increases if _______
A. marginal product exceeds average product B. average product exceeds marginal product C. total product increases D. marginal product increases
Refer to Table 4-11. The equations above describe the demand and supply for Chef Ernie's Sushi-on-a-Stick. What are the equilibrium price and quantity (in thousands) for Chef Ernie's sushi?
A) $50 and 100 thousand B) $40 and 50 thousand C) $60 and 20 thousand D) $80 and 80 thousand
An example of moral hazard is
a. people drive less carefully in icy conditions with antilock brakes as without b. people drive as safely with more airbags as without c. football players avoid 'spearing' with their heads even with safer helmets d. people read the medicine warnings as carefully when self-medicating versus with a doctor's prescription