Suppose that the government imposes an excise tax on widgets. The portion of the tax borne by the buyer of widgets depends upon
a. elasticity of demand.
b. income of buyers.
c. size of the tax that is imposed.
d. cross elasticity of demand between widgets and floogles.
a
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If C = $400, I = $100, G = $50, NX = $30, and NFP = $5, how much is GDP?
A) $580 B) $575 C) $585 D) $550
Some automobile owners will drive faster knowing that they are covered by health and automobile insurance. This behavior creates the problem of
A) fraudulent claims. B) moral hazard. C) adverse selection. D) pecuniary purchases.
Mechanisms that manufacturers can use to deal with misaligned retailer incentives include
a. setting a minimum retail price b. providing an exclusive contract to a single retailed in a market c. compensating retailers' sales staff for demonstrating, as well as selling, the product d. All of the above
The law of comparative advantage indicates that
a. a group of people will reduce their output when each good or service is supplied by the low opportunity cost producer. b. trading partners lose when they can acquire a good through trade cheaper than they can produce it. c. trade is most effective when people trade only among those in their own nation. d. a group of people can increase their output when each good or service is supplied by the low opportunity cost producer.