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Micro-Economics Ch 7 Questions

Micro-Economics Ch 7 Questions - Name Date 1 An excise tax...

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Page 1 Name: __________________________ Date: _____________ 1. An excise tax collected from the producers of a good: A) shifts the supply curve upward. B) creates a loss of revenue for the government. C) has a similar effect as a tax subsidy. D) shifts the supply curve downward. 2. Recently, the government considered adding an excise tax on CDs that can be used to record music and CD players that can record discs. If this tax was enacted, we would expect: A) that consumers would pay a higher price and producers would sell fewer of these CDs and CD players than before the tax. B) there to be no effect on consumption or the prices paid by consumers of these CDs and CD players. C) that consumers would pay a lower price and producers would receive a higher price for these CDs and CD players than before the tax. D) there to be an increase in economic activity due to the tax. 3. If an excise tax is imposed on automobiles and collected from consumers,: 4. The incidence of a tax: 5. An excise tax creates inefficiency in that the number of transactions in a market is reduced. Because the tax discourages mutually beneficial transactions, there is ________ from a tax.
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