Suppose consumers expect the price of a good to be higher in the future than it is today. Would the current demand for the good increase or decrease?
The current demand will increase.
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Efficient production can be carried out anywhere on or beyond the production possibilities frontier.
Answer the following statement true (T) or false (F)
Vertical equity in taxation refers to the idea that people
a. in unequal conditions should be treated differently. b. in equal conditions should pay equal taxes. c. should pay taxes based on the benefits they receive from the government. d. should pay a proportional tax rather than a progressive tax.
Refer to the below graph. Assume the market for this product started out at the intersection of D2 and S1. Then supply shifted from S1 to S2 due to an excise tax imposed on the product. If demand subsequently shifts from D2 to D1, then which of the following will decrease?
A. The tax per unit of the product
B. The tax revenue
C. The deadweight loss due to the tax
D. The portion of the tax per unit that is shouldered by the buyers
Economists assume that individuals make informed decisions and act in their own self-interest
Indicate whether the statement is true or false