Exam 14: Taxation and Income Distribution

In the press,there has been a considerable amount of attention given to the notion of corporations being taxed.Explain how it is that a tax on a business could be borne entirely by consumers.

Regardless of income level,when the ratio of taxes paid to income is constant then it is called

Regressive tax systems are bad.

Taxes

Demand for cigarettes is

An ad valorem tax is

General equilibrium refers to

Ad valorem taxes create tax wedges just like unit taxes.

Tax wedge is the difference between tax induced price paid by customer and the tax amount

A unit tax is a fixed amount per unit of a commodity sold.

Why is it the case that a commodity tax on goods like food and shelter is sometimes seen as being regressive?

A tax on consumers will cause the demand curve to shift

Partial equilibrium is

Why is it the case that taxes in one market can have impacts on supply and demand in others and should policy makers take this into account when setting taxes?

A demand curve that is perfectly inelastic is

Even with a tax,the price that consumers pay will be higher than what producers receive.

Unit taxes vary along with the price of the taxed commodity.

In 2009,the top 1% of all income earners paid _________ percent of federal taxes.

Due to capitalization,the burden of future taxes may be borne by current owners of an inelastically-supplied,durable commodity such as land.

Partial equilibrium is