A unit tax has an advantage over an ad valorem tax in situations when _____
a. inflation is high
b. it is easy to estimate the value of the good being taxed
c. it is difficult to estimate the value of the good being taxed
d. inflation is low
c
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A rightward shift in the demand curve for a product will ordinarily result from
A. a decrease in the advertising budget. B. a decrease in the price of a competing product. C. an increase in consumer income. D. an increase in the price of a complementary good.
Changing conditions in transportation during the years following the Civil War (1861–1865) provided an economic explanation for which of the following?
(a) Railroad amalgamation (b) A well founded fear of monopolies by agriculturalists (c) Large government funding budgets for railroads (d) All of the above
When Pepsi is considering a price hike, it needs to consider how Coke may react. This situation is called:
A. mutual interdependence. B. price leadership. C. collusion. D. monopolistic competition.
When the quantity effect outweighs the price effect:
A. a price increase will cause an increase in total revenue. B. a price increase will cause a decrease in total revenue. C. a price decrease will cause a decrease in total revenue. D. None of these is true.