Equivalent Variation Means

question 3

Multiple Choice

Equivalent variation means

• A) finding an equivalent change in income that puts a person on the same utility as a change in price would.
• B) finding equal tax rates that insure quantity demanded does not change.
• C) equalizing excess burden across all markets.
• D) moving the same distance in either direction from a starting point on an indifference curve.

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Definitions:

Inverse Demand Function

A function that expresses the price of a good or service as a function of the quantity demanded, typically used in economics to determine pricing strategies.

Tax Imposed

A financial charge or levy placed by a government on individuals, transactions, or properties to raise revenue.

Grapefruit

A large, yellowish citrus fruit with a somewhat bitter and sour taste.

Civic Authorities

Government officials or bodies responsible for the governance and administration of a specific locality or city.