The Excise Tax on Gasoline Is Based on the Ability-To-Pay

question 134

True/False

The excise tax on gasoline is based on the ability-to-pay principle of taxation.

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Definitions:

Diseconomies Of Scale

Exist when average costs rise with output.

Marginal Costs

The cost associated with producing one additional unit of a product, useful for decision-making on production levels and pricing.

Constant Returns To Scale

When average costs are constant with respect to output level.

Economies Of Scale

Cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output decreasing with increasing scale.