Suppose a Tax of $0

question 45

Multiple Choice

Suppose a tax of $0.50 per unit on a good creates a deadweight loss of $100.If the tax is increased to $2.50 per unit,the deadweight loss from the new tax would be

• A)$200.
• B)$250.
• C)$500.
• D)$2,500.

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Definitions:

Feeling Happy

A state of well-being and contentment.

Conditioned Stimulus

An initially indifferent stimulus that, following its connection with an unconditioned stimulus, eventually induces a conditioned response.

Unconditional Stimulus

Regarding classical conditioning, a stimulus spontaneously and automatically produces a response, requiring no earlier learning.

Operant Stimulus

A stimulus that follows a behavior and increases or decreases the likelihood of that behavior occurring again; used in operant conditioning.