Suppose that the government imposes a tax on producers equal to the value of the externalities imposed by the good or service. A ______________ elastic demand curve means consumers are less responsive to changes in price and the tax burden will fall more heavily on ______________.
a. more; government
b. more; consumers
c. less; producers
d. less; consumers
e. None of the above.
Ans: d. less; consumers
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In comparison to a government that runs a balanced budget, when the government runs a budget deficit,
A) business investment will fall. B) the equilibrium interest rate will fall. C) household savings will fall. D) none of the above
Using Figure 3 above, suppose that the economy was at Y3. This level of GDP would be considered:
A. recessionary. B. a long run level of output. C. a natural rate of output. D. inflationary.
A decrease in both supply and demand will lead to a decrease in equilibrium quantitY
a. true b. false
Which statement is true?
A. One basis for monopoly is control over an essential resource. B. All forms of a monopoly are illegal in the United States. C. Economies of being established is the same as economies of scale. D. General Motors is a monopoly.