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Question
Of the following items, which is/are most important in determining the distribution of tax burden?
a. the person who is legally responsible for paying the tax
b. the elasticities of supply and demand
c. the desired level of tax revenue
d. whether the tax is on income, wealth, sales, or imports
e. the dollar amount of the tax
Answer
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Related questions
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Suppose Solomon lives in a community with no price controls. What do you expect will happen if his town borders a community where there is a binding price ceiling on most products?
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A(n) ________ in the elasticity of supply or demand in a market for a good that is taxed would tend to ________ who is legally responsible for paying the tax.a. decrease; broaden b. decrease; have no effect on c. increase; broadend. increase; narrowe. increase; have no effect on
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A tax on milk would likely cause a decrease in the price ofa. ice cream. b. cheese. c. soymilk.d. nondairy creamer.e. breakfast cereal.
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A tax creates no deadweight loss only when either supply or demand isa. somewhat elastic. b. perfectly elastic. c. perfectly inelastic.d. increasing.e. decreasing.
Q:
The deadweight loss from a tax is likely to be less with a good that hasa. few complements. b. many substitutes. c. few substitutes.d. an elastic demand.e. an elastic supply.