Which of the following is TRUE about the effects of an excise tax if consumers are totally unresponsive to price changes?
A) Consumers pay all of the excise tax.
B) Producers pay all of the excise tax.
C) Consumers and producers share the excise tax equally.
D) Neither consumers nor producers pay the excise tax.
Answer: A
You might also like to view...
How has growth in M2 minus the growth in real GDP compared to the inflation rate in the United States?
What will be an ideal response?
According to the original Keynesian model, there would be counter-cyclical movements of the real wage rate in response to changes in aggregate demand because
A) firms react to nominal wages and workers respond to real wages. B) firms react to real wages and workers respond to the expected real wage. C) firms are on their labor demand curve and workers are off their labor supply curve. D) firms are off their labor demand curve and workers are on their labor supply curve.
To be certain that exchange between people is mutually beneficial, we generally assume
A) not all people are free to enter the market at will, but once in they are free to make any offer to trade. B) all people have complete information about each other's preferences. C) there are no transaction costs. D) both B and C E) both A and B
What does it mean when the dollar appreciates? What does it mean when the dollar depreciates?
What will be an ideal response?