All categories

3 years ago

The deadweight loss from a tax is likely to be greater with a good that has:

Business

1 answer:

Alona [7]3 years ago

4 0

Answer:

A. -many substitute

Explanation:

Deadweight loss is inefficiency that occurs as a result of taxation. It's the change in production or consumption as a result of tax.

If tax is imposed on a good with many substitutes, the deadweight loss would be greater because consumers can easily shift consumption to another good that is cheaper.

If a good has inelastic supply or demand, the deadweight loss is less because consumers and producers do not change quantity demanded and supplied if prices increase as a result of tax.

I hope my answer helps you.

You might be interested in

Instruments had retained earnings of $ 390 comma 000 at December 31, 2017. Net income for 2018 totaled $ 220 comma 000, and di

VashaNatasha [74]

Answer:

The retained earnings should Quartz report at December 31, 2018 is $570,000

Explanation:

In this question, we apply the retained earnings equation which is shown below:

Ending retained earnings balance = Beginning retained earning balance + net income - dividend paid

= $390,000 + $220,000 - $40,000

= $570,000

The net income should be added while dividend should be deducted for finding out the ending retained earnings balance

3 0

3 years ago

ames Sprater of Grand Junction, Colorado, has been shopping for a loan to buy a used car. He wants to borrow $18,000 for four or

Ghella [55]

Answer:

James' credit union loan rate is 8.88% APR, the local bank loan rate is 9.34% APR.

Explanation:

Hi, since in both cases payments would be done in a monthly basis, we have to assume that the rate that we are looking for is APR (compounded monthly), and since there is no additional information in regards that 9.25% rate, we can assume that this is effective annually, so let´s convert this effective monthly rate into APR (compounded monthly)

First, we have to convert it into an effective monthly rate, that is:

$r(month)=((1+r(annual))^{\frac{1}{12} } -1)$

$r(month)=((1+0.0925)^{\frac{1}{12} } -1)=0.00739963$

Then we multiply by 12 and we get 0,088796 , which is 8.88% APR (compounded monthly)

This way James can compare both credits. The cheaper loan is from the credit union.

4 0

3 years ago

What type of debt has the highest consumer debt balance?.

Zinaida [17]

The student loan debt has the highest consumer debt balance.

Below is an explanation about student loan debt.

<h3>What is Student Loan debt</h3>

Student debt is a type of debt that is owed by a current student, a formerly withdrawn student or graduated student to a lending institution, or to a financial institution

This type of loan has the highest consumer debt balance.

Lean more about types of debt at brainly.com/question/2754850

4 0

2 years ago

You bought one of Great White Shark Repellant Co.’s 5.8 percent coupon bonds one year ago for $1,030. These bonds make annual pa

defon

Answer:

total rate of return on the Bond = 9.40%

Explanation:

given data

coupon bonds = 5.8%

bonds price = $1,030

maturity time = 14 year

required return on the bonds = 5.1 percent

solution

we know here market price of the bond is Present Value of Coupon Payments + Present face Value

so that face Valueof bond = $1,000

and here annual Coupon Amount will be

annual coupon amount = $1000 × 5.80%

annual coupon amount = $58

and here Market Price of the Bond will be

Market Price of Bond = Present Value of Coupon Payments + Present face Value ......................1

here Present Value of Coupon Payments at PVIFA 5.10% and 14 Years

Present Value Annuity Inflow Factor (PVIFA) = $\frac{1-(1/(1+r)^t}{r}$ ....2

Present Value Annuity Inflow Factor = $\frac{1-(1/(1+0.0510)^14}{0.0510}$

Present Value Annuity Inflow Factor = 9.83566

and

Present Value Inflow Factor (PVIF) 5.10%, 14 Years= $\frac{1}{(1+r)^t}$ ...........3

Present Value Inflow Factor (PVIF) = $\frac{1}{(1+0.0510)^14}$

Present Value Inflow Factor = 0.49838

Market Price of Bond = ( $58 × 9.83566 ) + ( $1,000 × 0.49838 )

Market Price of Bond = $1,068.85

so total rate of return on the Bond will be

total rate of return on the Bond = [ { Annual Coupon Amount + ( Change in Bond Price ) } ÷ Current Price] ...............4

total rate of return on the Bond = $\frac{58+(1068.85-1030)}{1030}$

total rate of return on the Bond = 9.40%

5 0

3 years ago

At the beginning of this year, daily consumption of gasoline in the US amounted to 344 million gallons. It is estimated that for

Shkiper50 [21]

Answer:

335.43 million gallons

Explanation:

price elasticity of demand (PED) = % change in quantity demanded / % change in price

PED = -1.9% / 10% = -0.19, very inelastic

expected price increase $0.40

% change in price = ($3.45 - $3.05) / $3.05 = 13.11%

% change in quantity demanded:

-0.19 = D / 13.11%

D = 2.49%

quantity demanded will decrease by 2.49%, from 344 million gallons to 335.43 million gallons

8 0

3 years ago