Figure 6-19 -Refer to Figure 6-19.Which of the Following Is Correct

question 491

Multiple Choice

Figure 6-19

-Refer to Figure 6-19.Which of the following is correct?

• A) One-fourth of the burden of the tax falls on buyers, and three-fourths of the burden of the tax falls on sellers.
• B) One-third of the burden of the tax falls on buyers, and two-thirds of the burden of the tax falls on sellers.
• C) One-half of the burden of the tax falls on buyers, and one-half of the burden of the tax falls on sellers.
• D) Two-thirds of the burden of the tax falls on buyers, and one-third of the burden of the tax falls on sellers.

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Definitions:

Budget Deficit

A situation where a government's expenditures exceed its revenues, leading to the need for borrowing or using saved reserves.

Marginal Propensity To Consume

The ratio of the change in consumption spending to the change in disposable income, indicating how much of additional income will be spent.

John Maynard Keynes

A UK-based economist who significantly transformed both the theoretical and practical aspects of macroeconomics, as well as the economic strategies executed by governments.

Great Depression

A severe worldwide economic depression that took place mostly during the 1930s, beginning in the United States following the stock market crash of 1929.