A Tax That Does Not Change Consumers' Behavior Creates No

question 85

Multiple Choice

A tax that does not change consumers' behavior creates no

• A)economic burden.
• B)excess burden.
• C)tax revenue.
• D)tax incidence.

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Definitions:

Treasury Bonds

Long-term investment instruments issued by the government that pay periodic interest until expiration, at which point the face value is paid to the investor.

Treasury Bills

Short-term government securities issued at a discount from par value and mature without interest payments, offering a return upon maturity.

Real Rate of Return

The rate of return on an investment after adjusting for inflation, representing the actual purchasing power of the investment's earnings.

Standard Deviation

A measure of the amount of variation or dispersion of a set of values, indicating how much the values diverge from the mean.