Which of the Following Is an Accurate Statement About Tax

question 23

Multiple Choice

Which of the following is an accurate statement about tax incidence?

• A) Questions about tax incidence are purely problems of normative economics, that is, questions involving, "Who should pay the tax?"
• B) The incidence of the personal income tax is not generally agreed on.
• C) The property tax is borne entirely by the landlord.
• D) The incidence of the sales tax depends on the price sensitivity of the supply and demand curves for the taxed commodity.
• E) Economists agree that most, if not all, corporate income taxes are incidental.

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Definitions:

Prisoner's Dilemma

A situation in game theory where two individuals acting in their own self-interest do not produce the optimal outcome for either party.

Oligopolies

Market structures characterized by a small number of firms controlling a large majority of the market share and having significant impact on prices and production.

Pure Monopolies

Market structures characterized by a single seller that faces no competition, typically due to high barriers to entry.