According to economists, national defense can be supported through taxation because
A) national security generates no benefits for which any one would be willing to pay.
B) people are insufficiently patriotic.
C) taxation makes everyone pay in proportion to the benefits they receive.
D) the people who refuse to pay the cost cannot easily be excluded from the benefits.
E) we must choose between coercion through taxation and coercion through a draft.
D
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Per-unit transaction costs:
a. may cause the demand and supply curves to shift either inward or outward depending on the value obtained from transaction agents. b. refer only to the commission paid to a third-party for each transaction made. c. are absorbed by the party seeking the transaction. d. have the same effect on behavior as do lump-sum transaction costs; the difference in terminology is purely definitional.
A tax
a. lowers the price buyers pay and raises the price sellers receive. b. raises the price buyers pay and lowers the price sellers receive. c. places a wedge between the price buyers pay and the price sellers receive. d. Both b) and c) are correct.