Assume that for good X the supply curve for a good is a typical, upward-sloping straight line, and the demand curve is a typical downward-sloping straight line. If the good is taxed, and the tax is doubled, the
a. base of the triangle that represents the deadweight loss doubles.
b. height of the triangle that represents the deadweight loss doubles.
c. deadweight loss of the tax quadruples.
d. All of the above are correct.
d
You might also like to view...
Lucinda is deciding whether to enroll in an art school or a culinary school. The art school will cost $38,000 and the culinary school will cost $52,000
Lucinda estimates that the benefits from attending the art school will be $75,000 and the benefits from attending the culinary school will be $88,000. Based on these numbers, in which school should Lucinda enroll?
Referring to the table above, if consumption in period one is zero, then consumption in period two cannot be greater than ________
A) $72,800 B) $70,400 C) $71,200 D) $70,800