Suppose that an increase in the price level of one country drives up prices in other countries. This, in turn, increases the price level in the first country. This process is the

Laissez-faire advocates believe that the government should

a. nationalize certain industries b. not provide tax incentives to firms for research c. foster an environment that is favorable to research d. actively use price controls when excess profits are earned e. outlaw monopolies which use research to further their power

Which of the following will result in the greatest deadweight loss from tax?

a. A tax on gasoline b. A tax on Porsche cars c. A tax on salt d. A tax on cigarettes