Recall Application 3, "The Supply and Demand for Cruise Ship

question 261

Multiple Choice

Recall Application 3, "The Supply and Demand for Cruise Ship Berths," to answer the following questions:
-Based on the application, a severe recession (all else equal) would cause the equilibrium price of cruise ships berths to:

• A) increase or decrease, without certainty.
• B) remain constant.
• C) decrease.
• D) increase.

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Definitions:

Progressive Tax

A tax system where the tax rate increases as the taxable income or base increases, leading to a higher tax burden on wealthier individuals or entities.

Cigarette Tax

A levy imposed by governments on the sale of cigarettes to reduce consumption and generate revenue, often used for public health initiatives.

Proportional Tax

A tax system where the tax rate remains constant regardless of the amount subject to taxation.

Vertical Equity

A principle of fairness in taxation that dictates taxpayers with a greater ability to pay should contribute more in taxes.