The incidence of taxation refers to:
A. Who in society actually pays the tax
B. The structure of basic income tax rates
C. Whether taxes are progressive or regressive
D. Whether or not the benefits-received principle applies
A. Who in society actually pays the tax
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Suppose two neighbors share a park. One neighbor, Al, leaves trash in the park. This bothers the other neighbor, Bert. According to Coase's theorem, the optimal level of trash in the park can be achieved if
A) Al is fined by the government. B) Al has the right to leave trash and Bert cannot do anything about it. C) Al has the right to leave trash and Bert can pay him to limit his dumping. D) Bert moves.
When the economy reaches its potential output, the price level cannot rise any further
a. True b. False
Steak and chicken are substitutes. A sharp reduction in the supply of steak would
a. increase consumer surplus in the market for steak and decrease producer surplus in the market for chicken. b. increase consumer surplus in the market for steak and increase producer surplus in the market for chicken. c. decrease consumer surplus in the market for steak and increase producer surplus in the market for chicken. d. decrease consumer surplus in the market for steak and decrease producer surplus in the market for chicken.
Which of the following statements is false?
A) If there are only two goods, guns and butter, it is possible to produce more of both goods through economic growth. B) If there are only two goods, guns and butter, it is possible to produce more of both goods if the economy is currently operating at a productive inefficient point. C) If there are only two goods, guns and butter, it is possible to produce more of both goods if the economy is currently operating at a productive efficient point. D) If there are only two goods, guns and butter, producing more of one means producing less of the other if the economy is currently operating at a productive efficient point.