Taxation lowers social welfare when the taxed good
A. has marginal social costs above marginal private costs.
B. marginal social costs equals marginal private cost.
C. is overproduced under a free-market system.
D. imposes negative externalities .
Answer: B
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Simon Kuznets's research in his National Income and Its Composition showed that
a. Keynes's absolute income hypothesis is empirically correct b. budget deficits crowd out consumption spending c. a nation's MPC tends to remain fairly constant regardless of the absolute level of national income d. as national income increases, consumption spending increases, but by diminishing amounts e. consumption and income cannot be linked in any meaningful fashion
When a few rival groups spend money in competition for a license that grants them a monopoly for the provision of cable TV for an area, economists label this activity
A. perfect competition. B. oligopoly. C. monopolistic competition. D. rent seeking.