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Question 1 a. Is it true that if you double a tax, its Excess Burden quadruples? b. If government imposes a 20% tax on a particular type of television at the time when the market price is Ghc2,000.00 and the equilibrium quantity is 500 write an expression for the excess burden this tax imposes on society. What is the efficiency loss ratio of this tax?

Question 1 a. Is it true that if you double a tax, its Excess Burden quadruples? b. If government imposes a 20% tax on a particular type of television at the time when the market price is Ghc2,000.00 and the equilibrium quantity is 500 write an expression for the excess burden this tax imposes on society. What is the efficiency loss ratio of this tax?

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Question 1 a. Is it true that if you double a tax, its Excess Burden quadruples? b. If government imposes a 20% tax on a particular type of television at the time when the market price is Ghc2,000.00 and the equilibrium quantity is 500 write an expression for the excess burden this tax imposes on society. What is the efficiency loss ratio of this tax?
Transcribed Image Text:Question 1 a. Is it true that if you double a tax, its Excess Burden quadruples? b. If government imposes a 20% tax on a particular type of television at the time when the market price is Ghc2,000.00 and the equilibrium quantity is 500 write an expression for the excess burden this tax imposes on society. What is the efficiency loss ratio of this tax?
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