Economics: Private and Public Choice
16th Edition
ISBN: 9781337642224
Author: James D. Gwartney; Richard L. Stroup; Russell S. Sobel
Publisher: Cengage Learning US
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Chapter 12, Problem 12CQ
To determine
Impact of tax revenue when there is tax cut by reduction in marginal tax rate and increase in personal exemption allowance.
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Chapter 12 Solutions
Economics: Private and Public Choice
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- How should the government execute Fiscal Policy?arrow_forwardExplain the impact of per-unit sales to the buyer and the seller, using a DIAGRAM that illustrates the buyer’s share of tax and seller’s share of tax.arrow_forwardThe graph shows the market for smartphone chargers. Draw a point to show the price of a smartphone charger and the quantity bought and sold. Label it 1. The government imposes a tax of $4 per smartphone charger on buyers. Draw the D-tax curve and label it. Draw a point to show the price paid by buyers and the quantity bought and sold with the tax. Label it 2. Draw a point to indicate the price received by sellers and the quantity bought and sold with the tax. Label it 3. The tax is O A. split between the buyers and sellers, and the sellers pay more than the buyers OB. paid by the sellers because if the price rises by the amount of the tax sellers will lose business OC. split evenly between the buyers and sellers OD. paid by the buyers because it is imposed on the buyers by the government.arrow_forward
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- Which of the following is true of indirect business taxes? a) They are included in corporate profits. b) They are not included in the GDP. c) They reduce the value of total economic output thereby reducing the value of the GDP. d) They are collected by business firms that act as agents for the government. e) They are the same as personal income taxes.arrow_forwardGive an example for the Average Tax Rates?arrow_forwardTaxes are a burden and an obligation and people have a negative attitude towards their tax liabilities. In an effort to convince these people that there is a good outcome from the taxes they pay, can you mention a few positive things about paying taxes?arrow_forward
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