Which of the following statements is correct?
a. A tax levied on buyers will never be partially paid by sellers.
b. Who actually pays a tax depends on the price elasticities of supply and demand.
c. Government can decide who actually pays a tax.
d. A tax levied on sellers always will be passed on completely to buyers.
b
You might also like to view...
The ________ rate is the rate at which one currency can be traded for another
A) explicit exchange B) nominal exchange C) expected exchange D) real exchange
Why do economists predict that investment increases when the real rate of interest falls?
What will be an ideal response?
Which of the following would be most indicative of a shift to a more restrictive monetary policy?
a. Rapid expansion in the monetary base, higher short-term interest rates, and a decline in the growth rate of the M1 money supply. b. Rapid expansion in the monetary base, declining short-term interest rates, and an increase in the growth rate of the M2 money supply. c. A reduction in the monetary base, higher short-term interest rates, and a decline in the growth rate of the M2 money supply. d. A reduction in the monetary base, lower short-term interest rates, and a decline in the growth rate of the M1 money supply.
The Laffer curve illustrates that
A) there are two tax rates at which zero tax revenues are raised. B) a decrease in tax rates can cause an increase in tax revenues. C) an increase in tax rates can cause an increase in tax revenues. D) an increase in tax rates can cause a decrease in tax revenues. E) all of the above