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Which of these would be the best example of a proportional tax?   1. income tax 2. wages and earnings tax 3. sales tax 4. value added tax

Graph 2 (Isomorphic) – This question is worth 14 points.

Income Tax rate $0 to $40,000 25% $40,000 to $100,000 40% Over $100,000 60%   What is the effective tax rate if you earned $200,000? 47% 52% 58%    60%  

Which of the following observations would be consistent with the imposition of a binding price floor on a market? After the price floor becomes effective, a smaller quantity of the good is bought and sold a larger quantity of the good is demanded a smaller quantity of the good is supplied the price falls below the equilibrium price

The following table contains a demand schedule for a   Price Quantity Demanded $10 100 $20 Q1 If the law of demand applies to this good, then Q1 could be 1. 0 2. 100 3. 200 4. 400

Which of the following can lead to failure of the free market? externalities and market power externalities but not market power market power but not externalities neither externalities nor market power

When computing the opportunity cost of attending a basketball game you should include   the price you pay for the ticket and the value of your time the price you pay for the ticket, but not the value of your time the value of your time, but not the price you pay for the ticket neither the price of the ticket nor the value of your time

When a binding price ceiling is imposed on a market to benefit buyers, no buyers actually benefit some buyers benefit, but no buyers are harmed some buyers benefit, and some buyers are harmed all buyers benefit

  Panel (a) shows which of the following? (Remember the difference between a change in demand/shift vs quantity demanded/supplied) an increase in demand and an increase in quantity supplied an increase in demand and an increase in supply an increase in quantity demanded and an increase in quantity supplied an increase in quantity demanded and an increase in supply

In less than two years in the early 1920s, the cost of a German newspaper rose from 30 marks to 70,000,000 marks. This is a spectacular example of market power caused by a change in the country’s standard of living market power caused by a single firm controlling the newspaper production inflation caused by increased productivity in the economy inflation caused by an increase in the quantity of money in the economy