Microeconomics
11th Edition
ISBN: 9781260507140
Author: David C. Colander
Publisher: McGraw Hill Education
expand_more
expand_more
format_list_bulleted
Question
Chapter 19, Problem 5QAP
a)
To determine
Equal distribution of the burden of income tax.
b)
To determine
The effect of the absence of diminishing
c)
To determine
Effects of the decision to leave households with equal levels of utility.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Suppose the California legislature passed a sweeping law to lower the number of regulations for building homes such as decreasing the parking requirements and setback requirements.
Suppose there is a housing tax.
What is the effect of this law on the PES for housing?
What effect would this law have on the tax burden for buyers?
why do comsumers pay the tax on goods if the elasticity of demand is less than the elasticty of supply?
This question concerns rent subsidies. Suppose that under a rent subsidy the government will pay some specified proportion of the total rental price. Using an indifference map for "housing" (e.g. rooms of standard quality) and "all other commodities" analyze whether this approach to enhancing domestic welfare is more or less effective than granting income tax reductions equal in dollar amount to the amount of the rent subsidy? How do these compare to a lump sum $250 per month subsidy which must be applied toward rent or it is taken away?
Chapter 19 Solutions
Microeconomics
Ch. 19.1 - Prob. 1QCh. 19.1 - Prob. 2QCh. 19.1 - Prob. 3QCh. 19.1 - Prob. 4QCh. 19.1 - Prob. 5QCh. 19.1 - Prob. 6QCh. 19.1 - Prob. 7QCh. 19.1 - Prob. 8QCh. 19.1 - Prob. 9QCh. 19.1 - Prob. 10Q
Ch. 19.A - Prob. 1QECh. 19.A - Prob. 2QECh. 19.A - Prob. 3QECh. 19.A - Prob. 4QECh. 19 - Prob. 1QECh. 19 - Prob. 2QECh. 19 - Prob. 3QECh. 19 - Prob. 4QECh. 19 - Prob. 5QECh. 19 - Prob. 6QECh. 19 - Prob. 7QECh. 19 - Prob. 8QECh. 19 - Prob. 9QECh. 19 - Prob. 10QECh. 19 - Prob. 11QECh. 19 - Prob. 12QECh. 19 - Prob. 13QECh. 19 - Prob. 14QECh. 19 - Prob. 15QECh. 19 - Prob. 16QECh. 19 - Prob. 1QAPCh. 19 - Prob. 2QAPCh. 19 - Prob. 3QAPCh. 19 - Prob. 4QAPCh. 19 - Prob. 5QAPCh. 19 - Prob. 1IPCh. 19 - Prob. 2IPCh. 19 - Prob. 3IPCh. 19 - Prob. 4IPCh. 19 - Prob. 5IPCh. 19 - Prob. 6IPCh. 19 - Prob. 7IPCh. 19 - Prob. 8IPCh. 19 - Prob. 9IPCh. 19 - Prob. 10IP
Knowledge Booster
Similar questions
- Suppose that the government tends to maximize the tax revenue. How would the cannabis price drop affect the government tax revenue if cannabis was taxed by price? Did the government anticipate the cannabis price drop when designing the tax scheme. You may come up with an artificial numerical example to support your findings. are alcohol and cigarettes substitutes or complements of cannabis? How would the change in the price of cannabis possibly affect the market demand curve for alcohol/cigarettes?arrow_forwardSuppose the California legislature passed a sweeping law to DECREASING the parking requirements and setback requirements. Suppose there is a housing tax. What is the effect of this law on the PES for housing? What effect would this law have on the tax burden for buyers?arrow_forwardPeter has an endowment of 3 units of good x and 5 units of good y. He can buy and sell x at a price of 100 and y at the price of 200. He receives an income of $700 as alimony from a former spouse. a) Draw Peter’s budget line for x and y. Show his initial endowment of x and y on your diagram. b) Calculate the amount of x that he could afford if he bought only x and the amount of y he could afford if he bought only y. c) Write an equation for Peter’s budget.arrow_forward
- Willy the Worker has unavoidable personal commitments taking 8 hours per day. He can choose to work or to play (i.e., take leisure, a normal good) in the remaining hours. Being a graduate in Economics, he can charge $100 per hour for his consulting services when he chooses to work. The government's income tax system has a 0% tax rate for daily incomes from $0 to $ $600 per day; above $600 per day, the tax rate is 20%. Willy has a certain Utility Function U(L, I) where L = leisure playtime and I = Income. His Marginal Rate of Substitution is known to be derived from this equation: MRSL/I=2I/L. (Note that the "price" of Income is $1.) Willy thinks he pays enough taxes via the excise taxes on things he buys. So he decides to work the maximum number of hours he can without paying any income taxes. According to our Indifference Theory model, is Willy maximizing his satisfaction with his "no tax" choice, or should he work fewer hours?arrow_forwardEconomists use the word equity to describe a situation in which Select one: a. the benefits of society's resources are distributed fairly among society's members. b. each member of society has the same income. c. society is getting the maximum benefits from its scarce resources. d. each member of society has access to abundant quantities of goods and services, regardless of his or her income.arrow_forwardDo you think profit could be maintained if the tax burden were simply passed on to the consumers in the form of higher selling price? How will this affect sales? Explain.arrow_forward
- One rationale for imposing taxes on alcohol consumption is that people who drink alcohol impose negative spillovers on the rest of society—for example, through loud and unruly behaviour or intoxicated driving. If this rationale is correct, in the absence of governmental taxation, will people tend to consume too much, too little, or the right amount of alcohol?arrow_forwardSuppose that college tuition is eliminated for every admitted student to a public community college or a public 4‑year college or university. a. Such a policy would likely lead to a.a decrease in human capital, conferring a cost b.an increase in human capital, conferring a benefit . b. Such a policy would also lead to a.lower taxes, conferring a benefit b.higher taxes, conferring a cost . c. Such a policy would also lead to a a.rise b.fall in enrollment at private colleges and universities.arrow_forwardWhat if any are the effects of taxation on a normal profit?arrow_forward
arrow_back_ios
arrow_forward_ios
Recommended textbooks for you
Principles of MicroeconomicsEconomicsISBN:9781305156050Author:N. Gregory MankiwPublisher:Cengage Learning
Principles of Economics, 7th Edition (MindTap Cou...EconomicsISBN:9781285165875Author:N. Gregory MankiwPublisher:Cengage Learning
Principles of Economics (MindTap Course List)EconomicsISBN:9781305585126Author:N. Gregory MankiwPublisher:Cengage Learning
Principles of Microeconomics (MindTap Course List)EconomicsISBN:9781305971493Author:N. Gregory MankiwPublisher:Cengage Learning
Microeconomics: Private and Public Choice (MindTa...EconomicsISBN:9781305506893Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage Learning
Economics: Private and Public Choice (MindTap Cou...EconomicsISBN:9781305506725Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage Learning
Principles of Microeconomics
Economics
ISBN:9781305156050
Author:N. Gregory Mankiw
Publisher:Cengage Learning
Principles of Economics, 7th Edition (MindTap Cou...
Economics
ISBN:9781285165875
Author:N. Gregory Mankiw
Publisher:Cengage Learning
Principles of Economics (MindTap Course List)
Economics
ISBN:9781305585126
Author:N. Gregory Mankiw
Publisher:Cengage Learning
Principles of Microeconomics (MindTap Course List)
Economics
ISBN:9781305971493
Author:N. Gregory Mankiw
Publisher:Cengage Learning
Microeconomics: Private and Public Choice (MindTa...
Economics
ISBN:9781305506893
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning
Economics: Private and Public Choice (MindTap Cou...
Economics
ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning