Refer to the Figure Above

question 16

Multiple Choice

Refer to the figure above. The graph represents consumers and suppliers in a country that relies on imports. Curve D is domestic demand, Curve S is domestic supply and Curve I is the import supply curve. If the country allows imports, domestic demand is ____

• A) q₁
• B) q₂
• C) q₀
• D) none of the above

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Definitions:

FICA Tax

The FICA tax is a United States federal payroll tax imposed on both employees and employers to fund Social Security and Medicare.

Tax Burden

The total amount of taxes that individuals or businesses must pay, often considered in relation to their income or profits.

Payroll Tax

Obligatory payments required from employers or employees, usually expressed as a proportion of the salaries employees receive.

Tax Burden

The total amount of taxes paid by individuals or businesses, expressed as a percentage of income or revenue, indicating the financial impact of taxation.