The Size of a Tax and the Deadweight Loss That

question 136

Multiple Choice

The size of a tax and the deadweight loss that results from the tax are

• A)positively related.
• B)negatively related.
• C)independent of each other.
• D)equal to each other.

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Definitions:

Maximize Profits

Refers to strategies or actions undertaken by a business or enterprise aimed at increasing the difference between its total revenues and total costs.

Marginal Revenue

The additional income generated from selling one more unit of a product or service.

Nondiscriminating

Nondiscriminating implies an equal treatment or consideration without bias toward race, gender, age, or other differentiating characteristics.

Prefabricated Garages

Buildings for storing vehicles that are manufactured off-site in advance, usually in standard sections that can be easily shipped and assembled.