Sin Taxes Are

question 58

Multiple Choice

Sin taxes are:

• A)taxes assessed by religious organizations.
• B)taxes assessed on certain illegal acts.
• C)taxes assessed to discourage less desirable behavior.
• D)taxes assessed to fund a specific purpose.
• E)None of the choices are correct.

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Definitions:

Marginal Cost of Production

The cost of producing an additional unit of a good, taking into account both variable and fixed costs.

Price Elasticity of Demand

A measure of how much the quantity demanded of a good responds to a change in the price of that good, with elasticity greater than 1 indicating a high responsiveness.

Marginal Cost

The increase in cost resulting from the production of one additional unit of output.

Advertising Elasticity of Demand

Advertising elasticity of demand quantifies the change in demand for a product as a result of a change in the amount of advertising for that product.