If the Labour Supply Curve Is Nearly Vertical

question 61

Multiple Choice

If the labour supply curve is nearly vertical:

• A) a tax on labour has a large deadweight loss
• B) a tax on labour has a small deadweight loss
• C) a tax on labour has little impact on the amount of work labour is willing to do
• D) both B and C are correct

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Definitions:

Depressant

A substance that reduces arousal or stimulation, affecting the central nervous system.

Stimulant

A substance that raises levels of physiological or nervous activity in the body.

Opiate

Refers to a group of drugs derived from opium used for their analgesic, sedative properties, and can lead to addiction.

Endorphins

Natural chemicals produced in the brain that act as painkillers and are associated with feelings of pleasure and euphoria.