EBK PRINCIPLES OF MICROECONOMICS
7th Edition
ISBN: 9781305892811
Author: Mankiw
Publisher: CENGAGE LEARNING - CONSIGNMENT
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Question
Chapter 12, Problem 4CQQ
To determine
The application on which the policy of toll tax is based.
Expert Solution & Answer
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The government raises revenue through taxation to pay for the services it provides.
a. True
b. False
A toll is a tax on citizens who use toll roads. Thispolicy can be viewed as an application ofa. the benefits principle.b. horizontal equity.c. vertical equity.d. tax progressivity
Tax incidence usually falls
A. only on producers.
B. on both consumers and producers.
C. only on consumers.
D. on the government.
Chapter 12 Solutions
EBK PRINCIPLES OF MICROECONOMICS
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- Which of the following is not a canon of taxation? Pick a,b,c, or d a. Equity b. General Acceptability c. Convenience d. Certaintyarrow_forwardIf the production of computer chips yields greater technology spillovers than the production of potato chips, the government should Select one: a. discourage the production of computer chips with taxes. b. discourage the production of potato chips with taxes. c. encourage the production of potato chips with subsidies. d. encourage the production of computer Ichips with subsidies.arrow_forwardA pollution tax: A increases the price of the good taxed. B decreases the price of the good taxed. C increases the production of the good taxed. Dincreases the quantity ofthe taxed good demanded.arrow_forward
- c. A progressive tax d. A regressive tax QUESTION 3 Corporate profits are a. taxed to pay for Medicare. b. exempt from taxes. c. included in payroll taxes. d. taxed twice, once as profit and once as dividends. QUESTION 4 A value-added tax or VAT is a tax on a. retail purchases only. b. pollution. c. all stages of production of a good. d. wholesale purchases only. QUESTION 5 Table 12-17 INCOME $50,000 100,000 200,000 AMOUNT OF TAX $12,500 (25%) $25,000 (25%) $50,000 (25%) TAX Aarrow_forwardMarked out of1.00 When the price elasticity of demand is high and the price elasticity of supply is low, the burden of a tax falls primarily or Select one. a. buyers of the product. b. both buyers and sellers of the product equally C. the tax payers. d. sellers of the product. CLEAR MY CHOICEarrow_forwardPlease no written by hand solutions 1.Discuss the five properties of a good tax system 2. Discuss why there are inefficiencies in the consumption of public good. 3. Discuss the key functions of the government.arrow_forward
- A. Economic profit is an indication that consumers are willing to pay more for a good or service being offered. True False B. An advantage of tradable permits over emission taxes is that no knowledge of marginal abatement costs is needed to ensure that the tax rate is optimal. the regulator sets the price of permits. the regulator does not have to determine how much to reduce pollution levels. the regulator must set the optimal tax rate.arrow_forwardQuestion 23 Why might a tax be inefficient? a It distorts behavior, causing the marginal costs to be higher than the marginal benefits b The average cost of the tax is too high. c The tax is politically infeasible. d The tax does not collect enough revenue.arrow_forward1. What is the difference between private and social costs?2. How can the government intervene to force consumers to internalize external costs associated with: a. negative externalities? b. positive externalities?3. Differentiate between public good and common resources.4. What are the advantages of a flat tax system?arrow_forward
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