Consider that you are a government economist asked by a state legislature to apply excise taxes to a variety of goods sold in your state. You know you want to minimize the excess burden of taxation so you apply the Ramsey Rule
This means that you tell the legislature to _____. a. set the tax rates proportional to the elasticities of demand for each good b. set the tax rates in inverse proportion to the elasticities of demand for each good c. set the tax rates proportional to the elasticities of supply for each good
d. set the tax rates in inverse proportion to the elasticities of supply for each good
b
You might also like to view...
In the figure above, when 6,000 pizzas are produced, the marginal benefit of a pizza ________ its marginal cost, which means ________ pizza is being produced
A) exceeds; too little B) exceeds; too much C) is below; too much D) is below; too little E) equals; the efficient quantity of
Normative statements are easily debated whereas positive statements are simply rhetorical
Indicate whether the statement is true or false