The actual division of the burden of a tax between buyers and sellers in a marke

Question

The actual division of the burden of a tax between buyers and sellers in a market is called
A) tax incidence. B) tax liability. C) tax bearer. D) tax parity.

The government imposes a tax on beer. Buyers will pay the entire burden of the tax if the
A) supply curve for beer is vertical.
B) demand curve for beer is vertical.
C) demand curve for beer is horizontal.
D) demand curve is downward sloping and the supply curve is upward sloping.

The additional cost associated with undertaking an activity is called
A) net loss. B) marginal cost. C) opportunity cost. D) foregone cost.

At the competitive equilibrium
I. The quantity supplied is equal to quantity demanded.
II. Marginal benefit that consumers get from consuming the last unit is higher than the marginal cost of the
last unit produced, and the difference is maximized in order to maximize the benefits that consumers get
from the consumption of the good.
III. There is no shortage, but there is excess supply.
IV. The economic surplus is maximized.
V. The deadweight loss is positive, but minimized.
VI. The market is efficient.
A) I, II, and IV. B) I, IV, and VI. C) I, II, and VI D) III, IV, and VI.

Explanation / Answer

Be in writing in order to be valid. C) demand curve for beer is horizontal. A) net loss. II. Marginal benefit that consumers get from consuming the last unit is higher than the marginal cost of the The economic surplus is maximized. B) I, IV, and VI.

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