To Calculate the Revenue the Government Receives When a Tax

question 10

Multiple Choice

To calculate the revenue the government receives when a tax is imposed on a good, multiply the

• A) after-tax equilibrium price by the after-tax quantity.
• B) after-tax equilibrium price by the after-tax quantity and then subtract the pre-tax equilibrium price multiplied by the pre-tax quantity.
• C) tax by the pre-tax quantity.
• D) pre-tax equilibrium price by the pre-tax quantity.
• E) tax by the after-tax quantity.

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Definitions:

Rate of Growth

The percentage growth in the magnitude or worth of an item during a particular timeframe.

Required Rate of Return

The lowest annual yield necessary to draw individuals or firms towards investing in a specific venture or financial proposition.

Cumulative Voting

A voting system that allows shareholders to allocate all their votes to one candidate or distribute them among several candidates when electing directors.

Voting Shares

Shares that give the shareholder the right to vote on matters of corporate policy and the election of the board of directors.