If a Tax on a Good Is Doubled, the Deadweight

question 15

Multiple Choice

If a tax on a good is doubled, the deadweight loss from the tax

• A) doubles.
• B) stays the same.
• C) increases by a factor of four.
• D) could rise or fall.

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Definitions:

Computer Equipment

The physical hardware used for the operation of a computer system, including the central processing unit, monitors, keyboards, and mice.

Residual Value

The estimated value of an asset at the end of its useful life, often used in calculating depreciation or lease payments.

Depreciation

The purposeful spreading of the financial burden of a physical asset over its active life.

Accumulated Depreciation

The total amount of depreciation expensed over an asset's useful life, reducing its book value on the balance sheet.