In practice, taxes on emissions of pollutants have been found to
a. be ineffective in encouraging firms to pollute less.
b. significantly reduce pollution by taxed firms.
c. be less reliable in reducing pollution than direct controls on pollution.
d. cause failures of the pricing system.
b
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What do economists mean when they use the phrase "excess burden" as it relates to taxes?
What will be an ideal response?
Refer to the graph above. Ongoing inflation would occur if the Fed:
A. Increases the money supply causing AD to shift faster than technological progress shifts AS
B. Increases the money supply causing AD to shift slower than technological progress shifts AS
C. Increases the money supply causing AD to shift as fast as technological progress shifts AS
D. Does not increase the money supply while technological progress is shifting AS