MANKIW: PRINCIPLES OF MICROECONOMICS
8th Edition
ISBN: 9781337801775
Author: Mankiw
Publisher: CENGAGE L
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Question
Chapter 8, Problem 4CQQ
To determine
The impact of increased tax on peanut butter.
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The Ramesy rule suggest that society should
a. All of these answers are correct
b. tax a few goods with elastic demand at high rates.
c. tax goods with relatively inelastic demand at lower rates than goods with relatively elastic demand.
d. tax lots of goods at low tax rates.
I want the answer
Suppose that the Australian government imposes a sales tax on a product and both buyers and sellers share the burden of the If the price elasticity of demand for the product is perfectly inelastic. Which of the following is true?
Select one:
a. Sellers would pay more of the tax than buyers.
b. Buyers would pay all of the tax.
c. Buyers and sellers would share the tax burden equally.
d. Sellers would pay all the tax.
Chapter 8 Solutions
MANKIW: PRINCIPLES OF MICROECONOMICS
Ch. 8.1 - Prob. 1QQCh. 8.2 - The demand for beer is more elastic than the...Ch. 8.3 - Prob. 3QQCh. 8 - Prob. 1CQQCh. 8 - Prob. 2CQQCh. 8 - Prob. 3CQQCh. 8 - Prob. 4CQQCh. 8 - Prob. 5CQQCh. 8 - Prob. 6CQQCh. 8 - Prob. 1QR
Ch. 8 - Prob. 2QRCh. 8 - Prob. 3QRCh. 8 - Why do experts disagree about whether labor taxes...Ch. 8 - What happens to the deadweight loss and tax...Ch. 8 - Prob. 1PACh. 8 - Prob. 2PACh. 8 - Prob. 3PACh. 8 - Prob. 4PACh. 8 - Prob. 5PACh. 8 - Prob. 6PACh. 8 - Prob. 7PACh. 8 - Prob. 8PACh. 8 - Prob. 9PACh. 8 - Prob. 10PA
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- The government decides to reduce air pollution by reducing the use of petrol. It imposes £0.50 tax for each litre of petrol sold.a. Should it impose this tax on petrol companies or motorists? Explain carefully, using a supply and demand diagram. b. If the demand for petrol were more elastic, would this tax be more effective or less effective in reducing the quantity of petrol consumed? Explain with both words and a diagram.c. Are consumers of petrol helped or hurt by this tax? Why?d. Are workers in the oil industry helped orarrow_forwardWhen supply is perfectly elastic, who bears the burden of tax? Select one: a. producers b. consumers c. producers and consumers d. sellersarrow_forwardWhen a good is taxed, the burden of the tax fallsmainly on consumers ifa. the tax is levied on consumers.b. the tax is levied on producers.c. supply is inelastic and demand is elastic.d. supply is elastic and demand is inelasticarrow_forward
- Which of the following statements about the relationship between elasticity and tax incidence are true ? Choose one or more:A. A tax on a good for which both demand and supply are relatively inelastic will cause a relatively large transfer of welfare from consumers and producers to the government. B.The incidence of a tax depends on who the tax is placed on. C.If a tax is imposed on a good with a perfectly inelastic demand, then consumers bear the full incidence of the tax. D.When demand is more inelastic than supply, producers bear more of the incidence of a tax. E.When demand is more inelastic than supply, consumers bear more of the incidence of a tax.arrow_forwardSolve all this question......you will not solve all questions then I will give you down?? upvote...arrow_forwardA sales tax is imposed on good A. The supply of good A is not perfectly elastic or perfectly inelastic. Suppose that the demand for good A becomes more inelastic. (a) Will the tax burden on sellers increase or decrease? (b) Will the DWL increase or decrease?arrow_forward
- . A tax on umbrellas will most likely Select one: a. fall mostly on the umbrella buyers rather than the producers. b. be an effective way to tax those who don’t earn enough to pay income taxes. c. cause a large decline in the sales of umbrellas because demand is elastic. d. raise large amounts of tax revenue for the government.arrow_forwardThe Ramesy rule suggest that society should A.all of these B.tax a few goods with elastic demand at high rates C.tax lots of goods at low tax rates D.tax goods with relatively inelastic demand at lower rates than goods with relatively elastic demandarrow_forwardSubject:eco The elasticity of demand for maracas is –2.0, and the elasticity of supply is 3.0. How much will the price of maracas change with a per-unit tax of $1? Who bears the larger burden of the tax, consumers or producers?arrow_forward
- Which of the following, if true, would most effectively undermine the argument that raising cigarette taxes reduces the number of people who smoke cigarettes? a.The supply for cigarettes is relatively inelastic. b.The demand for cigarettes is relatively inelastic. c.The supply for cigarettes is relatively elastic. d.The demand for cigarettes is relatively elastic.arrow_forwardDon't use Ai and chatgpt. Answer in step by step with explanation.arrow_forward6. The government decides to place a $6 unit tax on a product. The following elasticities are known: E, = - 1; E,= 2. By how much does the price paid by the demanders increase because of this tax?arrow_forward
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