Economics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter21: Costs And The Supply Of Goods
Section: Chapter Questions
Problem 12CQ
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R4

True, False, or Uncertain? Give rationale to
your answers. Provide graphs.
Capital in all sectors will be worse-off when
there is a tax on capital in the manufacturing
sector where manufacturing sector is labor-
intensive and food is capital-intensive and
there are only 2 sectors (food and
manufacturing) and 2 inputs (capital and
labor) and inputs are mobile between
sectors.
Transcribed Image Text:True, False, or Uncertain? Give rationale to your answers. Provide graphs. Capital in all sectors will be worse-off when there is a tax on capital in the manufacturing sector where manufacturing sector is labor- intensive and food is capital-intensive and there are only 2 sectors (food and manufacturing) and 2 inputs (capital and labor) and inputs are mobile between sectors.
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