Part of the Surplus Lost to Market Participants When a Tax

question 154

Multiple Choice

Part of the surplus lost to market participants when a tax is imposed is:

• A)transferred to others who are affected by the tax.
• B)transferred to the government in revenues.
• C)redistributed from sellers to buyers.
• D)redistributed from buyers to sellers.

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Definitions:

Consumption Bundles

Combinations of various goods and services that a consumer might purchase using their total available income.

Income

The monetary payment received for work or through investments, pensions, or social benefits, used by individuals or households to consume goods and services.

Marginal Utility

The increased enjoyment or value a buyer gets by consuming an extra unit of a merchandise or service.

Broccoli

A green vegetable from the cabbage family, known for its nutritional benefits and eaten either raw or cooked.