As a Result of a Shortage

question 138

Multiple Choice

As a result of a shortage,

• A)Consumers increase demand for the product.
• B)Producers reduce supply.
• C)Producers increase output and raise price.
• D)Government purchases decrease.

---

Definitions:

Regressive Tax

A tax imposed in such a way that the tax rate decreases as the taxable amount increases, disproportionately affecting lower-income individuals.

Payroll Tax

Levies charged on employers or workers, typically based on a proportion of the wages that staff receive from their employers.

Labor Market

The labor market is an economic market in which workers seek employment and employers seek to hire workers, often influenced by factors like wages, demand, and qualifications.

Marginal Tax Rate

The rate at which the next dollar of taxable income is taxed, reflecting the incremental increase in tax paid on an additional dollar of income.