If asked to comment about a new tax on cotton collected from growers who do not grow their plants in the shade of other plants, an economist with no particular expertise in cotton growing might still note that
a. the price received by these cotton producers will fall by the full amount of the tax.
b. the price paid by consumers of this cotton will rise by the full amount of the tax.
c. the legal incidence of the tax does not determine who bears the burden of the tax.
d. the tax was imposed on the wrong party, it should have been placed on buyers.
c. the legal incidence of the tax does not determine who bears the burden of the tax.
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A firm is a price taker if it
A) always sells its output at the industry-determined price. B) takes consumer demand into consideration in setting its price. C) takes its production costs into consideration in setting its price. D) uses a pricing strategy to gain market share.
Total revenue minus both explicit and implicit costs
a. gross earnings. b. marginal earnings. c. profit. d. net worth.
The money multiplier and the income multiplier are two ways of referring to the same concept.
Answer the following statement true (T) or false (F)
To maximize profit, an unregulated natural monopoly will produce at a level where:
A. marginal revenue is greater than marginal cost. B. marginal revenue is greater than average revenue. C. marginal revenue is less than marginal cost. D. marginal revenue is equal to marginal cost.