Question 1

-The figure above shows the market for tires.The government has imposed a tax on tires,and the buyers pay ________ of the tax.

Accepted Answer

A)  $10 
B)  $20 
C)  $50 
D)  $60 
E)  $30 
A)  $10 
B)  $20 
C)  $50 
D)  $60 
E)  $30

Question 2

Suppose the demand for peaches from South Carolina is perfectly elastic.If the supply curve is upward sloping and a tax is imposed on peaches from South Carolina,then

Accepted Answer

A)  peach sellers pay all of the tax. 
B)  peach buyers pay all of the tax. 
C)  peach buyers and sellers evenly split the tax. 
D)  the government does not collect any revenue from the tax. 
E)  the tax does not change the equilibrium quantity of peaches. 
A)  peach sellers pay all of the tax. 
B)  peach buyers pay all of the tax. 
C)  peach buyers and sellers evenly split the tax. 
D)  the government does not collect any revenue from the tax. 
E)  the tax does not change the equilibrium quantity of peaches.

Question 3

The figure above shows the market for MP3 players, where S is the supply curve and D is the demand curve before any tax is imposed. The government imposes a $10 per unit tax on sellers of MP3 players.
-Based on the figure above,the burden of the tax

Accepted Answer

A)  is split equally between the buyer and the seller. 
B)  falls mostly on buyers. 
C)  falls mostly on sellers. 
D)  falls entirely on buyers. 
E)  falls entirely on sellers. 
A)  is split equally between the buyer and the seller. 
B)  falls mostly on buyers. 
C)  falls mostly on sellers. 
D)  falls entirely on buyers. 
E)  falls entirely on sellers.

Question 4

The ability-to-pay principle of tax fairness is equivalent to which of the following?

Accepted Answer

A)  collecting taxes from those who benefit the most from provision of public services 
B)  collecting more taxes from people who can more easily bear the burden 
C)  a regressive income tax structure 
D)  a proportional income tax structure 
E)  concern about only horizontal equity and no concern about vertical equity 
A)  collecting taxes from those who benefit the most from provision of public services 
B)  collecting more taxes from people who can more easily bear the burden 
C)  a regressive income tax structure 
D)  a proportional income tax structure 
E)  concern about only horizontal equity and no concern about vertical equity

Question 5

The marriage tax problem in the U.S.tax code is a problem involving which of the following?

Accepted Answer

A)  benefits received principle 
B)  the ability-to-pay principle 
C)  a conflict between horizontal and vertical equity 
D)  vertical equity 
E)  incidence of fairness principle 
A)  benefits received principle 
B)  the ability-to-pay principle 
C)  a conflict between horizontal and vertical equity 
D)  vertical equity 
E)  incidence of fairness principle

Question 6

Sales taxes are usually collected from sellers,who view the tax as

Accepted Answer

A)  resulting from a leftward of the demand curve. 
B)  an additional cost of selling the good. 
C)  an addition to the demand for the product. 
D)  an addition to profit. 
E)  the same as a rightward shift of the demand curve. 
A)  resulting from a leftward of the demand curve. 
B)  an additional cost of selling the good. 
C)  an addition to the demand for the product. 
D)  an addition to profit. 
E)  the same as a rightward shift of the demand curve.

Question 7

-Suppose we acquire the technology necessary to colonize the moon and 3 billion acres are made available to the general population.The figure above represents the supply and demand for land on the moon.
a.Suppose the government imposes a $1,000 dollar per acre tax on land income.What is the before-tax rent and what is the after-tax rent?
b.How much is the deadweight loss associated with this tax?

Accepted Answer

a.The before-tax rent is $3,000 per acre

Question 8

A tax on income from land in Montana is borne entirely by landowners because the

Accepted Answer

A)  demand for land is perfectly inelastic. 
B)  supply of land is perfectly inelastic. 
C)  supply of land is perfectly elastic. 
D)  demand for land is perfectly elastic. 
E)  deadweight loss from the tax would otherwise be infinite. 
A)  demand for land is perfectly inelastic. 
B)  supply of land is perfectly inelastic. 
C)  supply of land is perfectly elastic. 
D)  demand for land is perfectly elastic. 
E)  deadweight loss from the tax would otherwise be infinite.

Question 9

-The figure above shows the labor supply and labor demand curves for personal trainers in the state of Florida.The initial equilibrium hourly wage is $10.Suppose the state of Florida institutes an income tax on labor income of $6 an hour in order to buy voting machines for the next election.The deadweight loss from this tax equals the region

Accepted Answer

A)  abe. 
B)  bce. 
C)  cef. 
D)  efg. 
E)  cdf. 
A)  abe. 
B)  bce. 
C)  cef. 
D)  efg. 
E)  cdf.

Question 10

The deadweight loss of a tax on labor income is

Accepted Answer

A)  larger for high-wage workers than for low-wage workers. 
B)  not part of the total burden of a tax. 
C)  not a burden workers do not pay that tax. 
D)  zero for all workers because the supply of labor is perfectly inelastic. 
E)  zero for low income workers and small for high income workers. 
A)  larger for high-wage workers than for low-wage workers. 
B)  not part of the total burden of a tax. 
C)  not a burden workers do not pay that tax. 
D)  zero for all workers because the supply of labor is perfectly inelastic. 
E)  zero for low income workers and small for high income workers.

-The figure above shows the market for tires.The government has imposed a tax on tires,and the buyers pay ________ of the tax.

Suppose the demand for peaches from South Carolina is perfectly elastic.If the supply curve is upward sloping and a tax is imposed on peaches from South Carolina,then

The figure above shows the market for MP3 players, where S is the supply curve and D is the demand curve before any tax is imposed. The government imposes a $10 per unit tax on sellers of MP3 players. -Based on the figure above,the burden of the tax

The ability-to-pay principle of tax fairness is equivalent to which of the following?

The marriage tax problem in the U.S.tax code is a problem involving which of the following?

Sales taxes are usually collected from sellers,who view the tax as

A tax on income from land in Montana is borne entirely by landowners because the

The deadweight loss of a tax on labor income is

Getting Started

The U.S.and Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets with Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

Exam 8: Taxes

-The figure above shows the market for tires.The government has imposed a tax on tires,and the buyers pay ________ of the tax.

Suppose the demand for peaches from South Carolina is perfectly elastic.If the supply curve is upward sloping and a tax is imposed on peaches from South Carolina,then

The figure above shows the market for MP3 players, where S is the supply curve and D is the demand curve before any tax is imposed. The government imposes a $10 per unit tax on sellers of MP3 players. -Based on the figure above,the burden of the tax

The ability-to-pay principle of tax fairness is equivalent to which of the following?

The marriage tax problem in the U.S.tax code is a problem involving which of the following?

Sales taxes are usually collected from sellers,who view the tax as

A tax on income from land in Montana is borne entirely by landowners because the

The deadweight loss of a tax on labor income is

Getting Started

The U.S.and Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets with Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters