Question 1

Figure 8-1
​
  
-Refer to Figure 8-1.If the market is in equilibrium,what area represents consumer surplus

Accepted Answer

A) A 
B) B 
C) C 
D) D 
A) A 
B) B 
C) C 
D) D

Question 2

Figure 8-5
  
-Refer to Figure 8-5.With a tax imposed in this market,what would total surplus be

Accepted Answer

A) $1500 
B) $3600 
C) $4500 
D) $6000 
A) $1500 
B) $3600 
C) $4500 
D) $6000

Question 3

Why does it NOT matter whether a tax is levied on the buyer or seller of the good

Accepted Answer

A) because sellers always bear the full burden of the tax 
B) because buyers always bear the full burden of the tax 
C) because buyers and sellers always share the burden of the tax 
D) because government always bears the full burden of the tax 
A) because sellers always bear the full burden of the tax 
B) because buyers always bear the full burden of the tax 
C) because buyers and sellers always share the burden of the tax 
D) because government always bears the full burden of the tax

Question 4

Figure 8-5
  
-Refer to Figure 8-5.If the tax is imposed in this market,what price would the buyers pay for the good

Accepted Answer

A) $2 
B) $6 
C) $10 
D) $16 
A) $2 
B) $6 
C) $10 
D) $16

Question 5

Figure 8-2
  
-Refer to Figure 8-2.What area represents the amount of tax revenue received by the government

Accepted Answer

A) P₃ACP₁ 
B) ABC 
C) P₂DAP₃ 
D) P₁CDP₂ 
A) P₃ACP₁ 
B) ABC 
C) P₂DAP₃ 
D) P₁CDP₂

Question 6

Figure 8-4
  
-Refer to Figure 8-4.Which area represents producer surplus after the tax is levied on the producer

Accepted Answer

A) A 
B) A + B + C 
C) D + E 
D) F 
A) A 
B) A + B + C 
C) D + E 
D) F

Question 7

If the size of a tax is tripled,what would happen to the deadweight loss from the tax

Accepted Answer

A) It would double. 
B) It would triple. 
C) It would increase by a factor of six. 
D) It would increase by a factor of nine. 
A) It would double. 
B) It would triple. 
C) It would increase by a factor of six. 
D) It would increase by a factor of nine.

Question 8

Suppose that the equilibrium quantity in the market for widgets has been 200 per month.Then a tax of $5 per widget is imposed.The price paid by buyers increases by $2 and the after-tax price received by sellers falls by $3.The government is able to raise $750 per month in revenue from the tax.What is the deadweight loss from the tax

Accepted Answer

A) $50 
B) $75 
C) $125 
D) $250 
A) $50 
B) $75 
C) $125 
D) $250

Question 9

Figure 8-1
​
  
-Refer to Figure 8-1.When the market is in equilibrium,what area represents producer surplus

Accepted Answer

A) A + B 
B) B + C 
C) C 
D) A + D 
A) A + B 
B) B + C 
C) C 
D) A + D

Question 10

Which of the following is used in economic analysis to judge the effect of taxes on economic welfare

Accepted Answer

A) government deficits 
B) consumer and producer surplus 
C) equilibrium price and quantity 
D) opportunity cost 
A) government deficits 
B) consumer and producer surplus 
C) equilibrium price and quantity 
D) opportunity cost

Question 11

Figure 8-5
  
-Refer to Figure 8-5.If the tax is imposed in this market,what would the producer surplus be

Accepted Answer

A) $600 
B) $900 
C) $1200 
D) $1500 
A) $600 
B) $900 
C) $1200 
D) $1500

Question 12

The result of the large tax cuts in the first Reagan administration demonstrated that Arthur Laffer was right in his contention that reducing tax rates would increase tax revenues.

Accepted Answer

A) True 
 B)False

Question 13

Figure 8-5
  
-Refer to Figure 8-5.If the tax is imposed on the seller,what would the consumer surplus be

Accepted Answer

A) $600 
B) $900 
C) $1800 
D) $2200 
A) $600 
B) $900 
C) $1800 
D) $2200

Question 14

Because the supply of land is perfectly elastic,the deadweight loss of a tax on land is enormous.

Accepted Answer

A) True 
 B)False

Question 15

When evaluating the size of the deadweight loss due to a tax,what do we know

Accepted Answer

A) the greater the elasticities of supply and demand, the greater the deadweight loss 
B) the smaller the elasticities of supply and demand, the greater the deadweight loss 
C) the smaller the decrease in both quantity demanded and quantity supplied, the greater the deadweight loss 
D) the greater the elasticities of supply and demand, the smaller the deadweight loss 
A) the greater the elasticities of supply and demand, the greater the deadweight loss 
B) the smaller the elasticities of supply and demand, the greater the deadweight loss 
C) the smaller the decrease in both quantity demanded and quantity supplied, the greater the deadweight loss 
D) the greater the elasticities of supply and demand, the smaller the deadweight loss

Question 16

Illustrate on three demand and supply graphs how the size of a tax (small,medium,and large) can alter tax revenue and deadweight loss.

Accepted Answer

The answer of Illustrate on three demand and supply graphs...

Question 17

Figure 8-5
  
-Refer to Figure 8-5.If the tax is imposed on the buyer,what price would the buyers pay for the good

Accepted Answer

A) $2 
B) $6 
C) $10 
D) $16 
A) $2 
B) $6 
C) $10 
D) $16

Question 18

Scenario 8-1
Assume that Kierra cleans Cate's house weekly for $100.Cate would be willing to pay as much as $125 weekly to have her house cleaned.Kierra's opportunity cost is $80.
-Refer to Scenario 8-1.If Kierra cleans Cate's house,what is the producer surplus

Accepted Answer

A) $20 
B) $25 
C) $80 
D) $100 
A) $20 
B) $25 
C) $80 
D) $100

Question 19

Figure 8-4
  
-Refer to Figure 8-4.What is the price buyers pay after the tax and the quantity buyers receive

Accepted Answer

A) P₁ and Q₁ 
B) P₂ and Q₂ 
C) P₃ and Q₂ 
D) P₃ and Q₁ 
A) P₁ and Q₁ 
B) P₂ and Q₂ 
C) P₃ and Q₂ 
D) P₃ and Q₁

Question 20

Figure 8-6
  
-Refer to Figure 8-6.What would the reduction in consumer surplus caused by the tax be

Accepted Answer

A) $60 
B) $70 
C) $80 
D) $100 
A) $60 
B) $70 
C) $80 
D) $100

Exam 8: Application: the Costs of Taxation

Figure 8-1 ​ -Refer to Figure 8-1.If the market is in equilibrium,what area represents consumer surplus

Figure 8-5 -Refer to Figure 8-5.With a tax imposed in this market,what would total surplus be

Why does it NOT matter whether a tax is levied on the buyer or seller of the good

Figure 8-5 -Refer to Figure 8-5.If the tax is imposed in this market,what price would the buyers pay for the good

Figure 8-2 -Refer to Figure 8-2.What area represents the amount of tax revenue received by the government

Figure 8-4 -Refer to Figure 8-4.Which area represents producer surplus after the tax is levied on the producer

If the size of a tax is tripled,what would happen to the deadweight loss from the tax

Figure 8-1 ​ -Refer to Figure 8-1.When the market is in equilibrium,what area represents producer surplus

Which of the following is used in economic analysis to judge the effect of taxes on economic welfare

Figure 8-5 -Refer to Figure 8-5.If the tax is imposed in this market,what would the producer surplus be

The result of the large tax cuts in the first Reagan administration demonstrated that Arthur Laffer was right in his contention that reducing tax rates would increase tax revenues.

Figure 8-5 -Refer to Figure 8-5.If the tax is imposed on the seller,what would the consumer surplus be

Because the supply of land is perfectly elastic,the deadweight loss of a tax on land is enormous.

When evaluating the size of the deadweight loss due to a tax,what do we know

Illustrate on three demand and supply graphs how the size of a tax (small,medium,and large) can alter tax revenue and deadweight loss.

Figure 8-5 -Refer to Figure 8-5.If the tax is imposed on the buyer,what price would the buyers pay for the good

Scenario 8-1 Assume that Kierra cleans Cate's house weekly for $100.Cate would be willing to pay as much as $125 weekly to have her house cleaned.Kierra's opportunity cost is $80. -Refer to Scenario 8-1.If Kierra cleans Cate's house,what is the producer surplus

Figure 8-4 -Refer to Figure 8-4.What is the price buyers pay after the tax and the quantity buyers receive

Figure 8-6 -Refer to Figure 8-6.What would the reduction in consumer surplus caused by the tax be

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, demand, and Government Policies

Consumers, producers, and the Efficiency of Markets

Application: International Trade

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

Filters

Figure 8-1 -Refer to Figure 8-1.If the market is in equilibrium,what area represents consumer surplus

Figure 8-1 -Refer to Figure 8-1.When the market is in equilibrium,what area represents producer surplus