Explain Under What Conditions a Sales Tax on a Specific

question 179

Essay

Explain under what conditions a sales tax on a specific good would be paid entirely by buyers.

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Definitions:

Basic Assumption

An underlying principle or idea that is accepted as true without proof, forming the basis for further reasoning or behavior.

Level Of Investment

The amount of spending by businesses on capital goods, such as factories and machinery, which can influence economic growth.

Keynes

Refers to John Maynard Keynes, an economist famous for his ideas that in times of low demand, public sector investments are critical to economic stability and growth.

Macroeconomic Policies

Strategies and initiatives implemented by a government or monetary authority to control and improve the overall performance of the economy, including monetary, fiscal, and trade policies.