If the government imposes a specific tax on a monopoly, the consumer's tax incidence
A) can exceed 100%.
B) will always be between 0-100%.
C) may be negative.
D) will be the same as when the tax is imposed on a perfectly competitive firm.
A
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The problem of asymmetric information that brings about a general decline in product quality in an industry is
A) a market failure. B) the result of government regulation. C) creative response. D) the lemons problem.
Which of the following goods have a negative income elasticity of demand?
a. Cars b. Items from Dollar stores c. Shoes d. Bread
Which of the following statements is true of the impact of trade restrictions on domestic employment?
a. Domestic firms will produce the goods that otherwise would have been produced abroad, thus employing foreign workers instead of domestic workers. b. Beside the protected industry, other industries will also benefit in terms of employment. c. Domestic consumers will be required to pay lower prices for the output of the protected industry. d. Restrictions imposed on trade simply redistribute jobs by creating employment in the protected industry and reducing employment elsewhere. e. If other countries retaliate by restricting the entry of the domestic exports, the output of domestic firms that produce for export will rise.
Trade allows each country to take advantage of lower ___________ costs in the other country.
a. replacement b. opportunity c. marginal d. retail