Suppose the tax on gasoline is decreased from $0.60 per gallon to $0.40 per gallon. As a result,
a. tax revenue necessarily decreases.
b. the deadweight loss of the tax necessarily decreases.
c. the demand curve for gasoline necessarily becomes steeper.
d. the supply curve for gasoline necessarily becomes flatter.
b
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All of the Newly Industrializing Economies are in East Asia
Indicate whether the statement is true or false
If a subsidy (going to producers) on a good is eliminated, this would
A. move its supply curve to the right. B. cause a movement along the supply curve to a (lower price, lower quantity) point. C. move its supply curve to the left. D. cause a movement along the supply curve to a (higher price, higher quantity) point.
The cost of not being able to extract and sell a nonrenewable resource in the future (because it is being extracted in the present) is known by natural resource economists as the:
A. extraction cost. B. future cost. C. conservation cost. D. user cost.
If supply increases and demand decreases,
A. the market clearing price definitely rises, and the effect on the equilibrium quantity is indeterminate. B. the market clearing price definitely rises, and the equilibrium quantity definitely falls. C. the market clearing price definitely falls, and the effect on the equilibrium quantity is indeterminate. D. the effect on the market clearing price is indeterminate, and the equilibrium quantity definitely falls.