In the Absence of Taxes, Jane Would Prefer to Purchase

question 29

Multiple Choice

In the absence of taxes, Jane would prefer to purchase a large four-wheel drive (4WD) .However, the government has recently decided to place a $10 000 nuisance tax on 4WDs.Which of the following statements best reflects the effect of this tax if Jane decides to purchase a small economy car as a result of the tax?

• A)other people who choose to purchase 4WDs will incur the cost of the deadweight loss of the tax
• B)there are no deadweight losses as long as some people still choose to purchase 4WDs
• C)all deadweight losses are mitigated if there is a net decrease in air pollution
• D)Jane is worse off, and her loss of welfare is part of the deadweight loss of the tax

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Definitions:

Resting Heart Rate

The number of heartbeats per minute when an individual is at rest, used as an indicator of cardiovascular fitness and overall health.

Adolescent Growth Spurt

a rapid increase in an individual's height and weight during puberty, resulting from accelerated bone growth.

Secondary Sexual Characteristics

Secondary sexual characteristics are features that appear during puberty which are not directly involved in reproduction but distinguish the two sexes, such as breast development in females and facial hair in males.

Adult Height

The final height an individual achieves after undergoing the growth phases of childhood and adolescence, influenced by genetics and environmental factors.