51.Taxescausedeadweightlossesbecausetaxes
a.reducethesumofproducerandconsumersurplusesbymorethantheamountoftaxrevenue.
b.preventbuyersandsellersfromrealizingsomeofthegainsfromtrade.
c.causemarginalbuyersandmarginalsellerstoleavethemarket,causingthequantitysoldtofall.
d.Alloftheabovearecorrect.
52.Deadweightlossmeasurestheloss
a.inamarkettobuyersandsellersthatisnotoffsetbyanincreaseingovernmentrevenue.
b.inrevenuetothegovernmentwhenbuyerschoosetobuylessoftheproductbecauseofthetax.
c.ofequalityinamarketduetogovernmentintervention.
d.oftotalrevenuetobusinessfirmsduetothepricewedgecausedbythetax.
53.Thelossintotalsurplusresultingfromataxiscalled
a.adeficit.
b.economicloss.
c.deadweightloss.
d.inefficiency.
54.Deadweightlossisthe
a.declineintotalsurplusthatresultsfromatax.
b.declineingovernmentrevenuewhentaxesarereducedinamarket.
c.declineinconsumersurpluswhenataxisplacedonbuyers.
d.lossofprofitstobusinessfirmswhenataxisimposed.
55.Adeadweightlossisaconsequenceofataxonagoodbecausethetax
a.inducesthegovernmenttoincreaseitsexpenditures.
b.inducesbuyerstoconsumeless,andsellerstoproduceless.
c.increasestheequilibriumpriceinthemarket.
d.imposesalossonbuyersthatisgreaterthanthelosstosellers.
56.Thesupplycurveformotoroilisthetypicalupward-slopingstraightline,andthedemandcurveformotoroilisthetypicaldownward-slopingstraightline.Whenmotoroilistaxed,theareaontherelevantsupply-and-demandgraphthatrepresentsthedeadweightlossis
a.largerthantheareathatrepresentsconsumersurplusintheabsenceofthetax.
b.largerthantheareathatrepresentsgovernment’staxrevenue.
c.atriangle.
d.Alloftheabovearecorrect.
57.Thesupplycurveforwhiskeyisthetypicalupward-slopingstraightline,andthedemandcurveforwhiskeyisthetypicaldownward-slopingstraightline.Whenwhiskeyistaxed,theareaontherelevantsupply-and-demandgraphthatrepresents
a.government’staxrevenueisarectangle.
b.thedeadweightlossofthetaxisatriangle.
c.thelossofconsumersurpluscausedbythetaxisneitherarectanglenoratriangle.
d.Alloftheabovearecorrect.
58.Forwidgets,thesupplycurveisthetypicalupward-slopingstraightline,andthedemandcurveisthetypicaldownward-slopingstraightline.Ataxof$15perunitisimposedonwidgets.Thetaxreducestheequilibriumquantityinthemarketby300units.Thedeadweightlossfromthetaxis
a.$1,750.
b.$2,250.
c.$3,000.
d.$4,500.
59.Inthemarketforwidgets,thesupplycurveisthetypicalupward-slopingstraightline,andthedemandcurveisthetypicaldownward-slopingstraightline.Theequilibriumquantityinthemarketforwidgetsis200permonthwhenthereisnotax.Thenataxof$5perwidgetisimposed.Asaresult,thegovernmentisabletoraise$800permonthintaxrevenue.Wecanconcludethattheequilibriumquantityofwidgetshasfallenby
a.40permonth.
b.50permonth.
c.75permonth.
d.100permonth.
60.Inthemarketforwidgets,thesupplycurveisthetypicalupward-slopingstraightline,andthedemandcurveisthetypicaldownward-slopingstraightline.Theequilibriumquantityinthemarketforwidgetsis250permonthwhenthereisnotax.Thenataxof$6perwidgetisimposed.Asaresult,thegovernmentisabletoraise$750permonthintaxrevenue.Wecanconcludethattheafter-taxquantityofwidgetsis
a.75permonth.
b.100permonth.
c.125permonth.
d.150permonth.
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