The Laffer curve relates
a. the tax rate to tax revenue raised by the tax.
b. the tax rate to the deadweight loss of the tax.
c. the price elasticity of supply to the deadweight loss of the tax.
d. government welfare payments to the birth rate.
a
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With a tax of $4,000 on $24,000 taxable income, the average tax rate is
A. 16.67%. B. 23.45%. C. 20%. D. 25%.
If it is difficult to substitute for a good in the short run, but easy in the long run, then
A) the elasticity of demand is more elastic in the short run. B) the elasticity of demand is more elastic in the long run. C) the good is an inferior good. D) elasticity changes along the demand curve.
In the short run, which of the following statements is correct?
A. The marginal cost curve intersects the average variable and average fixed cost curves at their minimum points. B. Average variable cost declines continuously as total output is expanded. C. Total cost will exceed variable cost. D. If the inputs of all resources are increased by equal amounts, total output will expand by diminishing amounts.
Suppose that an economy's output does not change from one year to the next, but the price level doubles. What happens to real GDP?
A. Real GDP doubles B. Real GDP is halved C. Real GDP doesn't change D. There is not enough information to determine what happens to real GDP