You are a policy maker who is interested in increasing tax revenues in order to reduce the Federal budget deficit. One proposal that has been suggested is increase excise taxes on certain goods. Some of the options suggested are: • vacation travel such as cruises liquor and cigarettes • gasoline . theater and concert tickets Based on your knowledge of elasticity of demand, which items would you choose? Explain.
You are a policy maker who is interested in increasing tax revenues in order to reduce the Federal budget deficit. One proposal that has been suggested is increase excise taxes on certain goods. Some of the options suggested are: • vacation travel such as cruises liquor and cigarettes • gasoline . theater and concert tickets Based on your knowledge of elasticity of demand, which items would you choose? Explain.
Principles of Microeconomics
7th Edition
ISBN:9781305156050
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter8: Application: The Cost Of Taxation
Section: Chapter Questions
Problem 4CQQ
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![14
K
You are a policy maker who is interested in increasing tax
revenues in order to reduce the Federal budget deficit. One proposal that has been suggested
is increase excise taxes on certain goods. Some of the options suggested are:
• vacation travel such as cruises
• liquor and cigarettes
• gasoline
. theater and concert tickets
Based on your knowledge of elasticity of demand, which items would you choose? Explain.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F9f059010-aab4-485c-be78-4109f41204f8%2F8eba495d-64b3-4c87-baab-48cd0de92efb%2Ffelonn_processed.jpeg&w=3840&q=75)
Transcribed Image Text:14
K
You are a policy maker who is interested in increasing tax
revenues in order to reduce the Federal budget deficit. One proposal that has been suggested
is increase excise taxes on certain goods. Some of the options suggested are:
• vacation travel such as cruises
• liquor and cigarettes
• gasoline
. theater and concert tickets
Based on your knowledge of elasticity of demand, which items would you choose? Explain.
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