Is there a difference between the "true burden" of a tax and who is legally required to pay a tax? Briefly explain
What will be an ideal response?
There is a difference. The true burden of a tax refers to the tax incidence, or how much of a tax is ultimately paid by the sellers and how much is paid by the buyers. The incidence of a tax does not depend on whether the government collects a tax from the buyers of a good or from the sellers.
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If the price of a good increases, a consumer will substitute away from the relatively more expensive good, which will increase the marginal utility for that good and bring the consumer back to equilibrium
Indicate whether the statement is true or false
List the competitive forces in the five competitive forces model
What will be an ideal response?
An asset that can easily be exchanged for goods and services is referred to as:
a. an intangible asset. b. a productive resource. c. a liquid asset. d. a fixed asset. e. a scarce resource.
Suppose that a business incurred implicit costs of $200,000 and explicit costs of $1 million in a specific year. If the firm sold 4,000 units of its output at $300 per unit, its accounting profits were:
A. zero and its economic loss was $200,000. B. $200,000 and its economic profits were zero. C. $100,000 and its economic profits were zero. D. $100,000 and its economic profits were $100,000.