Which of the following statements is true of the tax on gasoline?
a. The cost of collecting a gasoline tax outweighs the revenues raised by the tax.
b. It is preferred to tolls as the best solution to road congestion.
c. It discourages driving on noncongested roads, even though there is no congestion externality for these roads.
d. Both b and c are correct.
c
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One of the key income tax topics debated during the 2008 Presidential election was whether the
A. 1986 tax increases should be repealed in 2011. B. Iraqi oil revenues should be taxed by the U.S. to provide care for disabled Iraqi War veterans. C. 2003 tax cuts should be allowed to expire in 2011. D. national sales tax should be abolished and replaced with a single income tax rate of 21%.
Using calculations of the cost to Americans per job saved in protected industries, it can be concluded that
A) import quotas are an efficient way to redistribute income. B) each job saved is worth more than the cost imposed on consumers per job saved. C) each job saved is worth less than the cost imposed on consumers per job saved. D) tariffs are an efficient way to redistribute income to disadvantaged groups.
The ATC rises whenever the
a. upward pull of the AVC is greater than the downward pull of the AFC. b. upward pull of the AFC is greater than the downward pull of the AVC. c. AVC is equal to the AFC. d. MC is above the AVC.
All of these factors create economies of scale, except
a. Specialization and Division of Labor b. Technological Factors c. Increase in advertisement costs d. Quantity discounts