Refer to the above figures. A unit tax of $2 has been levied on a good. Which of the panels depict the effect of the taxes?
A) Panel 1
B) Panel 2
C) Panel 3
D) None of the diagrams reflect the effect of the tax.
A
You might also like to view...
According to new growth theory,
A) growth in real GDP per capita occurs only if there are increasing returns. B) technological change is influenced by economic incentives. C) economic growth is determined by forces outside the control of the market system. D) centrally-planned economies are the most efficient.
Refer to Figure 15-13. In the figure above, if the economy in Year 1 is at point A and is expected in Year 2 to be at point B, then the appropriate monetary policy by the Federal Reserve would be to
A) lower income taxes. B) raise interest rates. C) raise income taxes. D) lower interest rates.
Suppose you paid $500,000 for an asset. You hold the asset for five years. The interest rate that you get for the asset is 10%. Assume the tax rate on capital gains is 20%.
(A) If capital gains are taxed only when the asset is realized, how much will you have earned on the asset? (B) Suppose that capital gains are taxed annually instead of at realization. How much will you have earned on the asset? (C) How big is the difference in the two taxing schemes?
A nation's infrastructure includes all of the following except its
a. market system b. educational system c. energy system d. railroad system e. religious system