A Tax on a Good Causes the Size of the Market

question 33

True/False

A tax on a good causes the size of the market to shrink.

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Definitions:

Anxiety

This is a feeling of worry, nervousness, or unease, typically about an imminent event or something with an uncertain outcome.

Risk-as-feelings Hypothesis

A theory suggesting that people's decision-making is influenced by their emotional responses to the possibility of negative outcomes.

Gut Reactions

Instantaneous responses we have to a situation or stimulus, not based on rational analysis but on our innate, visceral feelings.

Broaden-and-build Theory

A psychological model suggesting that positive emotions expand one's awareness and inspire novel, varied, and exploratory thoughts and actions.