Tax incidence refers to
a. what product or service the tax is levied on.
b. who bears the tax burden.
c. what sector of the economy is most affected by the tax.
d. the dollar value of the tax revenues.
b
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If goods X and Y are substitutes and the price of X falls, all other things being equal, the demand curve for Y will
A) be indeterminate. B) shift to the right. C) shift to the left. D) not shift at all.
Which of the following is not true about a monopsonist's rule to choose the profit- maximizing wage-employment combination? a. It is the same as in perfectly competitive labor markets, that is, it hires untilMRP = MLC
b. It results in workers not getting paid their marginal revenue product. c. It generates a return to monopsony power. d. It is consistent with the ethics underlying wage determination in a perfectly competitive labor market, that is W = MRP. e. It equates the marginal cost of labor to its marginal revenue product.