After the imposition of sales tax supply curve shifts to the leftward direction. What is the price that sellers receive after they have paid the tax to the government.
Inflationary Gap
Upward by the amount of the tax.
. Select the best answer for each of the following questions. Causes the effective price to sellers to increase. Thus the incidence of a sales tax falls entirely.
This tax causes the demand curve for fountain drinks to shift downward by 050 at each quantity. The new supply curve including the cost of the tax is QS. Upward by less than the amount of the tax.
A Taxes cause deadweight losses because they distort incentives for both buyers and sellers. The response of buyers to a change in the price of bananas is strong and the response of sellers to a change in the price of bananas is weak. Reference Tables for Corporate Individual andor Trust Income Tax Rate Schedules required for certain problem solutions as indicated after the problems learning objective.
This tax causes the demand curve for fountain drinks to shift downward by 050 at each quantity. Here S T is the post-tax supply curve. The price paid by buyers is indeed 030 per drink more than it was before the tax.
However demand being perfectly elastic price is not altered. As a result the supply of the commodity gets reduced. A voluntary payment to the government for services received b.
D A decrease in the number of sellers. View the full answer. When a tax is imposed on the sellers of a good the supply curve shifts.
The price paid by buyers is 030 per drink more than it was before the tax. Affects the welfare of buyers of the good but not the welfare of sellers. A tax on buyers is analyzed by shifting the demand curve up by the amount of the tax.
Which of the following statements is correct. A 050 tax on each fishing lure sold raises the price per lure by 050. The difference between the two supply curves S and S T determines the volume of tax.
All of the following are true except. Causes the effective price to sellers to increase. A A technological improvement which reduces the cost of production.
A A subsidy causes the value of goods to exceed the cost of producing the goods. A tax placed on a good a. If a tax is levied on the buyers of a product then the demand curve.
Causes the equilibrium quantity of the good to decrease. C Taxes cause deadweight losses because they cause marginal buyers and marginal. Creates a burden that is usually borne entirely by the sellers of the good.
This further causes the supply curve to shift to the left. A tax imposed on the sellers of a good will also result in negativity. C A higher sales tax on automobiles.
Which of the following statements is TRUE. Creates a burden that is usually borne entirely by the sellers of the good. Further suppose this tax causes the effective price received by sellers of fountain drinks to fall by 020 per drink.
While the price that sellers receive for their good decreases. C A subsidy means that the sellers receive less than buyers pay. Affects the welfare of buyers of the good but not the welfare of sellers.
Consequently the price that buyers pay for the commodity will increase. Suppose a tax is imposed on bananas. But in both cases when the tax is activated the price paid by both the sellers and buyers rises and profit received by the sellers eventually falls.
When the tax is levied on sellers the supply curve shifts upward by that amount. This is true as the difference between 050 and 020 is 030. Which of the following government interventions causes the buyers and sellers to face the same price.
In which of the following cases will the tax cause the equilibrium quantity of bananas to shrink by the largest amount. Which of the following government interventions causes the buyers and sellers to face different prices from one another. A tax placed on a good a.
D Suppliers receive more benefit of a subsidy if the elasticity of supply is less. Under taxation consumers pay a different price and sellers receiv. Downward by less than the amount of the tax.
A tax on sellers is equivalent to a tax on buyers. Downward by the amount of the tax. B Taxes cause deadweight losses because they prevent buyers and sellers from realizing some potential gains from trade.
Causes the supply curve to shift to the right. A Suppose the government imposes a 1 tax per unit on sellers of chewing gum. Which of the following government interventions causes the buyers and sellers to face the same price.
What is a tax. What is the new equilibrium after the tax on sellers is imposed. B A subsidy reduces deadweight loss of non-beneficial trade.
In other words pre-tax and post-tax price P P T are the same. Which of the following events would cause a rightward shift in the market supply curve for automobiles. B An increase in the wages of autoworkers.
A tax imposed on the seller causes the cost of production to increase. Causes the equilibrium quantity of the good to decrease.
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