Suppose that a 25 tax is placed on cigarettes Under what circumstances will

Suppose that a 25 tax is placed on cigarettes under

This preview shows page 26 - 29 out of 58 pages.

73. Suppose that a $.25 tax is placed on cigarettes. Under what circumstances will cigarette producers pay the full amount of the tax? A. If supply is perfectly elasticB. If demand is perfectly inelasticC.If supply is perfectly inelasticD. The consumer and the seller always share the burden of the taxAACSB: AnalyticBloom's: ApplicationLearning Objective: 17-4Level: ModerateTopic: Tax incidence and efficiency loss 74. The economic tax incidence is shifted forward to the consumer to a larger extent the: AACSB: AnalyticBloom's: KnowledgeLearning Objective: 17-4Level: DifficultTopic: Tax incidence and efficiency loss 17-26
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Chapter 17 - Public Choice Theory and the Economics of Taxation 75. If the demand curve for a good slopes downward, and the supply curve of the good slopes upward, the imposition of a tax which increases the costs of production: AACSB: AnalyticBloom's: ApplicationLearning Objective: 17-4Level: EasyTopic: Tax incidence and efficiency loss 76. The supply of meat is more elastic in the long run than in the short run. Ceteris paribus, astime goes by, a tax on cattle will be increasingly passed on to the: AACSB: AnalyticBloom's: ApplicationLearning Objective: 17-4Level: ModerateTopic: Tax incidence and efficiency loss 77. In 1981, Congress considered increasing the Federal tax on gasoline by $.10 per gallon. Oil industry analysts predicted that nearly all of the tax could be "passed on" to the consumer, at least in the short run. Which of the following statements is consistent with the analysts' view? In the short run the gasoline: A. Demand curve is perfectly elasticB. Supply curve is perfectly inelasticC. Demand curve is relatively more elastic than the supply curveD.Demand curve is relatively more inelastic than the supply curveAACSB: AnalyticBloom's: ApplicationLearning Objective: 17-4Level: Moderate Topic: Tax incidence and efficiency loss 17-27
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Chapter 17 - Public Choice Theory and the Economics of Taxation
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