A Payroll Tax Is Imposed on Two Types of Labor

question 228

Multiple Choice

A payroll tax is imposed on two types of labor: welders and machinists. In the short run, the elasticity of labor supply of welders is much more elastic than the elasticity of labor supply of machinists. Which of the following is true?

• A) In the short run, welders will bear a larger share of the payroll tax than machinists.
• B) In the short run, machinists will bear a larger share of the payroll tax than welders.
• C) In the short run, welders and machinists will bear the same share of the payroll tax, but in the long run, machinists will bear a larger share of the payroll tax than welders.
• D) There is not enough information to determine the relative shares of the payroll tax for welders and machinists in either the short run or the long run.

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Definitions:

Ovary

One of the pair of female reproductive organs that produce eggs and secrete hormones, including estrogen and progesterone.

Reproductive Life

Refers to the period in a person's life when they are able to conceive or father children.

Birth

The act or process of bearing or bringing forth offspring.

Innominate Bone

Another term for the hip bone, which is formed by the fusion of the ilium, ischium, and pubis bones.