A tax has an excess burden whenever
A. people are unable to alter their behavior to avoid paying it.
B. government seeks to raise it.
C. it raises a great deal of revenue.
D. it induces people to change their behavior.
Answer: D
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How does the demand curve for an oligopoly firm differ from the demand curves for firms in competitive market structures?
What will be an ideal response?
Subprime mortgages are mortgage loans:
A. made to borrowers with higher than average credit scores. B. made to borrowers with low credit scores. C. that have less than prime interest rates. D. made at lower than general market interest rates.
The economy's self-correcting mechanism
a. prevents the economy from ever being in disequilibrium b. guides the economy to full employment in the long run c. maintains a steady long-run price level d. is a short-run adjustment process e. is controlled by the Fed
When a surplus exists in a market, sellers
a. raise price, which increases quantity demanded and decreases quantity supplied, until the surplus is eliminated. b. raise price, which decreases quantity demanded and increases quantity supplied, until the surplus is eliminated. c. lower price, which increases quantity demanded and decreases quantity supplied, until the surplus is eliminated. d. lower price, which decreases quantity demanded and increases quantity supplied, until the surplus is eliminated.