If the supply of automobiles becomes more inelastic, then a tax on automobiles is
A) paid more by the buyers after the change than before.
B) paid more by the sellers after the change than before.
C) always split evenly between the buyers and the sellers.
D) paid more by the government after the change than before.
E) always paid entirely by the buyers.
B
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If a the government of Country Z is running a budget deficit and net exports are zero, then
A) investment is greater than saving. B) investment and saving are equal. C) saving is greater than investment. D) none of the above.
Markets tend toward equilibrium and, as a result, will tend to eliminate shortages and surpluses. Why?
With rational expectations, a policy that would increase AD would lead to: a. higher inflation and higher real output in the short run
b. higher inflation and lower real output in the short run. c. higher inflation and an indeterminate effect on real output in the short run, if people's expectations were correct. d. higher inflation and no change in real output, if people's expectations were correct in the short-run.
The rights to own private property and to exchange goods with minimal government interference is
A. economic freedom. B. capital freedom. C. political freedom. D. population freedom.