Buyers of a good will bear the larger part of the tax burden, and sellers will bear a smaller part of the tax burden, when the
a. tax is placed on the sellers of the good
b. tax is placed on the buyers of the good.
c. supply of the product is more elastic than the demand for the good.
d. demand for the product is more elastic than the supply of the good.
c
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Refer to the scenario above. The principal in this case is:
A) $300. B) $1,000. C) $1,300. D) $2,300.
The U.S. personal savings rate for the first quarter of 2012 dropped to its lowest level since the start of the recession. Americans stashed away 3.6 percent of personal income in the first quarter, down from 4
2 percent in the fourth quarter and a near-term peak of 6.2 percent in the second quarter of 2009. Which of the following could explain this drop in savings? A) a decrease in wealth from a fall in stock prices B) a rise in the real interest rate C) an increase in disposable income as the job market recovers D) a rise in consumer confidence that their incomes will be higher in the future
Marginal revenue product is the effect of a one-unit increase in an input on the cost of production.
Answer the following statement true (T) or false (F)
Which of the following statements about externality is INCORRECT?
A) Pollution of a chemical plant will create negative externalities to the residents living in the neighborhood. B) Trees planted in the backyard of a house could create positive externalities to the pedestrians passing under. C) Extra output sold by a firm that lowers the market price creates negative externalities to its rivals. D) A single action may confer positive externalities on some people, but negative externalities on others.