Typically, When Government Imposes an Ad Valorem or a Specific

question 146

Multiple Choice

Typically, when government imposes an ad valorem or a specific tax on producers,

• A)both consumer surplus and producer surplus are reduced.
• B)producer surplus is reduced to zero.
• C)consumer surplus is reduced to zero.
• D)consumer surplus is preserved because producers must pay the tax.
• E)producer surplus is preserved because costs are passed on to consumers.

---

Definitions:

Extrinsic Motivation

Motivation driven by external rewards such as money, fame, grades, or praise.

External Rewards

Benefits or incentives provided by an external source, such as money, praise, or recognition, that motivate behavior.

Psychology

The scientific study of the mind and behavior, encompassing various aspects of human experience, mental functions, and characteristics.

Motivation

The process that initiates, guides, and maintains goal-oriented behaviors, driving individuals to pursue particular objectives.