How Much Deadweight Loss a Tax Causes Is Primarily Determined

question 7

Multiple Choice

How much deadweight loss a tax causes is primarily determined by:

• A)how responsive buyers and sellers are to a price change.
• B)how much tax revenue the government generates.
• C)whether the tax is imposed on the buyer or seller.
• D)the ability of the government to impose the tax.

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Definitions:

Machine Driven Industry

Industries that rely heavily on machinery and technology for production processes, marking a shift from manual to mechanized labor.

American Workers

Individuals employed in the United States, contributing to its economy and labor market.

Unskilled Workforce

A section of the labor market that has no special training or skills, typically associated with lower-paying jobs that require minimal education or training.

Prices Rose

An economic condition where the general level of prices for goods and services increases over a period.