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:

Catheters

Tubes that can be inserted into the body to treat diseases or perform a surgical procedure.

Stents

Tubular support devices inserted into blood vessels, canals, or ducts to keep the passageway open.

Film

A thin layer or coating, or a series of still images on celluloid or similar material, that when shown in succession creates the illusion of motion.

Through Body

Pertains to a process or movement happening from one side of the body to the other or affecting the entire body.