HW 3c- Ch 19-20_Xtns

HW 3c- Ch 19-20_Xtns - HW 3c: Chapters 19-20 Chapter 19 1....

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HW 3c: Chapters 19-20 Chapter 19 1. Recall that Social Security is funded through payroll taxes levied on both employers and employees. Suppose a politician were to state that since large corporations can better afford paying such taxes, the payroll tax levied on employees should be shifted to employers. What do you think? Explain. 2. Is it possible for the government to impose a tax that causes the market price of the good to fall? Explain. 3. Suppose that the demand for apples is perfectly elastic and the government levies a tax on the producers of apples. Assume that the supply of apples is neither perfectly elastic nor perfectly inelastic. a. How will the price paid by consumers change? Is this change bigger or smaller than the price change that would result if the demand for apples were not perfectly elastic? b. How will the quantity of apples consumed change due to the tax? Is this change in quantity larger or smaller than the change that would result if the demand for apples were not perfectly elastic? c.
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HW 3c- Ch 19-20_Xtns - HW 3c: Chapters 19-20 Chapter 19 1....

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