Starting from long-run equilibrium, a large tax increase will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.

Deadweight costs in an exchange are costs

A) charged for free goods. B) imposed by government, such as taxes or safety requirements. C) that have no effect on either the quantity demanded or the quantity supplied. D) that have nothing to do with the sacrifice of valuable opportunities. E) to the buyer that are not simultaneously benefits to the seller.

Economists assume that households try to maximize utility and firms try to:

a. maximize profits. b. maximize scale of operation. c. maximize sales. d. maximize capital usage.