If an excise tax is placed on a product that has a price elasticity of demand equal to zero, then the
a. entire tax will be paid by the consumer
b. entire tax will be paid by the producer
c. consumer and producer will each pay a share of the tax
d. incidence of the tax cannot be determined unless we know the coefficient of price elasticity of supply
e. tax is progressive
A
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An increase in real disposable income will:
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A good way to start every Three-Sector-Model analysis is to:
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What is the theory of efficiency wages? Provide four reasons that employers might pay efficiency wages
Suppose the following Lagrangian is formed to maximize a consumer's utility subject to her budget constraint: ? = U(X,Y) + ?(1,000 - 50X - 50Y). The first-order conditions for this problem imply:
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