If consumer pays entire tax, good is _________________.
Fill in the blank(s) with the appropriate word(s).
Ans: perfectly inelastic
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For a monopolist, the price effect:
A. always outweighs the quantity effect. B. is the decrease in revenues from selling a greater quantity at a lower price. C. is always outweighed by the quantity effect. D. is the increase in revenues from selling a greater quantity at a lower price.
The self-correcting tendency of the economy means that falling inflation eventually eliminates:
A. exogenous spending. B. recessionary gaps. C. expansionary gaps. D. unemployment.
A tariff affects imports
A. by limiting quantity and raising price to a higher level. B. by reducing quantity demanded so that supply falls. C. by increasing supply, raising price, and reducing demand. D. by raising price and reducing quantity demanded.
Tariffs are considered to be a popular tax in the first world countries, who justify them on the basis of the revenue they generate for government spending
a. True b. False Indicate whether the statement is true or false