Explain the concept of efficiency as it relates to taxation
A tax is said to be efficient if it has used every available opportunity to make someone better off without making someone else worse off. Taxes are almost always inefficient, but some taxes are more inefficient than others.
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A variable cost function of the form: VC = 52 + 2Q + 3Q2 implies a marginal cost curve that is
A) constant. B) upward sloping. C) U-shaped. D) quadratic.
Sample selection bias occurs when
A) the choice between two samples is made by the researcher. B) data are collected from a population by simple random sampling. C) samples are chosen to be small rather than large. D) the availability of the data is influenced by a selection process that is related to the value of the dependent variable.
A tax imposed on the buyers of a good will
a. raise both the price buyers pay and the effective price sellers receive. b. raise the price buyers pay and lower the effective price sellers receive. c. lower the price buyers pay and raise the effective price sellers receive. d. lower both the price buyers pay and the effective price sellers receive.
If the marginal benefit of reducing water pollution is constant at $10 per ton, then it is efficient to reduce water pollution:
A. to zero. B. until the marginal cost of reducing water pollution equals $10 per ton. C. as long as the marginal cost of reducing water pollution is greater than $10 per ton. D. to whatever level the market determines.