If a $500 Tax Is Placed Legally (Statutorily) on the Buyers

question 159

Multiple Choice

If a $500 tax is placed legally (statutorily) on the buyers of new couches and as a result the price of couches at stores rises by $200, the actual burden of the tax

• A) falls completely on couch buyers.
• B) falls completely on couch sellers.
• C) is $200 on couch buyers and $300 on sellers.
• D) is $300 on couch buyers and $200 on sellers.

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Definitions:

Reciprocal Liking

The phenomena where people tend to like others who like them in return.

Primacy Effect

The cognitive phenomenon where individuals are more likely to remember and give more weight to information that is presented first in a series.

Matching Hypothesis

The notion that people tend to have lovers or spouses who are similar to themselves in physical attractiveness and other assets.

Conformity

is the act of matching attitudes, beliefs, and behaviors to group norms, policies, or societal expectations.