As the economy contracts, tax revenues ________ and transfer payments __________.
A. fall; rise
B. fall; fall
C. rise; fall
D. rise; rise
A. fall; rise
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The Volumetric Ethanol Excise Tax Credit (VEETC) is a tax credit (which acts like a subsidy) for registered ethanol-gasoline blenders. Qualified blenders receive $0.51 for each gallon of pure ethanol they blend into gasoline
What statement is TRUE? A) With a subsidy, the price paid by consumers will be lower than without a subsidy. B) Without a subsidy, the quantity produced by blenders will be greater than the quantity demanded. C) With a subsidy, the equilibrium quantity produced will be lower than without a subsidy. D) With a subsidy, production will be efficient.
Currently there is a market demand for toothpaste with baking soda in it. New medical studies show that baking soda has health benefits beyond clean teeth. After these studies are published, the market demand is such that at any price, consumers buy 10 more tubes of toothpaste than they used to. This is a parallel, rightward shift of the demand curve. Which of the following statements is true?
a. Because the curves are parallel, the elasticities don't change. b. Despite the fact that the curves are parallel, elasticity has increased. c. Even though the curves are parallel, the new one is more inelastic. d. There is no relationship between the curves and their elasticities. e. Elasticities on the new demand curve have increased at low prices and decreased at high prices.
Which of the following statements is true?
A) An increase in demand causes a change in equilibrium price; the change in price does not cause a further change in demand or supply. B) A decrease in supply causes equilibrium price to rise; the increase in price then results in a decrease in demand. C) If both demand and supply increase there must be an increase in equilibrium price; equilibrium quantity may either increase or decrease. D) If demand decreases and supply increases one cannot determine if equilibrium price will increase or decrease without knowing which change is greater.
Medicaid patients are disproportionately
A. female children. B. female. C. children. D. wealthy.