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Explain Why in an Ideal Supply and Demand Model It

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Explain why in an ideal supply and demand model it does not really matter whether a tax on a good has to be paid out of pocket by the consumer or by the seller.


Definitions:

Skills Mismatch

A situation where the skills of workers do not match the needs of the jobs available, leading to inefficiencies in the labor market.

Unemployment Types

Categories that differentiate the reasons individuals are without employment, including cyclical, frictional, and structural unemployment.

Frictionally Unemployed

Individuals temporarily out of work while transitioning between jobs, often reflecting the natural movement in the labor market.

Recessionary Period

A time characterized by a significant decline in economic activity across the economy, lasting more than a few months.

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