Suppose the federal excise tax rate on gasoline is increased by 50 percent. Which of the following is the most likely impact on the tax revenue derived from the federal gas tax?
a. Tax revenues will increase by less than 50 percent.
b. Tax revenues will increase by 50 percent.
c. Tax revenues will increase by more than 50 percent.
d. The revenue from the gasoline tax will go to zero.
A
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Compared to the case in which a monopoly insurer offers the consumer a contract, if insurance is competitively provided:
a. any moral hazard or adverse-selection problem is alleviated. b. any moral hazard or adverse-selection problem is worsened. c. the essence of any moral hazard or adverse-selection problem would not change much. d. insurers would no longer offer menus of contracts.
A clear conclusion from offshoring debates and analyses is that:
a. If offshoring isn't stopped, some nations are likely to go bankrupt. b. Tariffs and quotas are needed to protect nations from offshoring's ill effects. c. Offshoring is often disruptive in the short run and can have significant transition costs. d. Offshoring lacks any potential to increase a nation's GDP and holds only the potential to keep GDP the same or reduce it.