The Actual Burden of a Tax Is Determined Primarily by

question 173

Multiple Choice

The actual burden of a tax is determined primarily by

• A) the elasticities of demand and supply.
• B) the legal (or statutory) assignment of the tax.
• C) the number of exchanges that are eliminated from the market as a result of the tax.
• D) none of the above.

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Definitions:

Hypothetical Consumer

An assumed average consumer used in economic and marketing models to predict the behavior of consumer populations.

Utility-Maximizing

A principle in economics whereby individuals seek to optimize their satisfaction or happiness through the consumption of goods and services.

Total Product Curve

A graphical representation showing how the quantity of output depends on the quantity of a variable input, holding all other inputs fixed.

Average Product

Calculating the efficiency of input by dividing the entire production by the volume of input.