Extra Questions from Ch. 6, Midterm 1

Extra Questions from Ch. 6, Midterm 1 - a. The tax is paid...

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Extra Question From Ch 6, Midterm 1, Fall 07 Multiple Choice Identify the letter of the choice that best completes the statement or answers the question. Figure 6-11. On the graph below, the shift of the supply curve from S 1 to S 2 represents the imposition of a tax on a good. On the axes, Q represents the quantity of the good and P represents the price. ____ 1. Consider Figure 6-11 . The amount of the tax per unit is a. $1.50. b. $2.00. c. $2.50. d. $3.00. ____ 2. Consider Figure 6-11 . As a result of the tax, a. the price paid by buyers rises from $5 to $7. b. the price received by sellers (after paying the tax) falls from $5 to $3. c. the government collects $30 in tax revenue. d. All of the above are correct. ____ 3. Consider Figure 6-11 . Which of these statements about the effects of the tax is correct?
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Unformatted text preview: a. The tax is paid by sellers; sellers bear one-half of the burden of the tax; government col-lects $24 from the tax. b. The tax is paid by sellers; sellers bear one-third of the burden of the tax; government col-lects $24 from the tax. c. The tax is paid by sellers; sellers bear two-thirds of the burden of the tax; government col-lects $30 from the tax. d. The tax is paid by buyers; buyers bear two-thirds of the burden of the tax; government col-lects $16 from the tax. Extra Question From Ch 6, Midterm 1, Fall 07 Answer Section MULTIPLE CHOICE 1. ANS: D DIF: 2 REF: 6-2 TOP: Tax MSC: Applicative 2. ANS: A DIF: 2 REF: 6-2 TOP: Tax MSC: Applicative 3. ANS: B DIF: 3 REF: 6-2 TOP: Tax burden MSC: Applicative...
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This note was uploaded on 04/19/2008 for the course ECON 2304 taught by Professor Majumder during the Fall '07 term at University of Houston.

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Extra Questions from Ch. 6, Midterm 1 - a. The tax is paid...

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