"In South Africa, the tax on insulin is between 10 and 20 percent. If you are rich and living in South Africa, this is not a problem, but if you are poor, then insulin becomes something that you cannot afford." Why do buyers care so much about a tax on insulin, a vital daily medicine for those with diabetes? a. Because the tax incidence is equal between the buyers and sellers b.
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Economics
"In South Africa, the tax on insulin is between 10 and 20 percent. If you are rich and living in South Africa, this is not a problem, but if you are poor, then insulin becomes something that you cannot afford." Why do buyers care so much about a tax on insulin, a vital daily medicine for those with diabetes?
a.
Because the tax incidence is equal between the buyers and sellers
b.
Because buyers pay virtually the entire tax on insulin because the demand is almost perfectly inelastic
c.
Because more insulin can be provided to those in need
d.
Because sellers increase their profit when there is a tax
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Solved in 2 steps
- 18. The U.S. Senate is considering a bill that would tax the sale of laptop computers in order to fund a computer educa- tion program for presidential hopefuls. The Congressional Budget Office (CBO) estimates that if it implements a low tax of $12 per laptop, revenue should be sufficient to exactly fund the program. The CBO also estimates that a high tax of $230 per laptop will exactly fund the program. a. How can a low tax and a high tax raise exactly enough money to fund the program? Illustrate your answer using a graph. b. Suppose that you are an economic advisor to the Senate Finance Committee, tasked with analyzing the economic impact of the tax proposals. Which proposal do you recommend, and why?The following is a Table that contains the demand and supply schedules of chocolate ice-creams. Price (cents per ice-cream) $0.90 0.80 0.70 0.60 0.50 0.40 Quantity Demanded (millions per day) 1 asifWNH 2 3 4 5 6 Quantity Supplied (millions per day) 7 6 10 10 5 4 3 2 a) If there is no tax on ice-creams, what is their price and how many are produced and consumed? b) If a tax of $0.20 cents is imposed on every ice-cream consumed, what happens to the price of an ice-cream and the number produced and consumed? Illustrate the effects of this policy on the market for chocolate ice-creams. c) How much tax does the government collect and who pays it?Daniel Patrick Moynihan, the late senator from New York, once introduced a bill that would levy a 10,000 percent tax on certain hollow-tipped bullets. A 10,000 percent tax on bullet ___ is not/is___ likely to generate a lot of revenue. Why might Senator Moynihan have proposed it? To boost the manufacturing industry of hollow-tipped bulletsTo raise revenue to support law enforcementTo discourage the use of hollow-tipped bullets
- Suppose the market for cigarette is competitive. An economist estimates the price elasticity of demand and supply for cigarette are -0.8 and 0.7 respectively. Suppose the government imposes a per-unit tax of $45 Some economists believe that a sales tax, in general, is undesirable. Explain. Despite this, why do most countries still impose a tax on cigarette? Explain plausible arguments.What would happen if, in order to provide lower cost healthcare, the government decided to set a price ceiling (Pmax) in the health insurance market? What is the effect of this maximum price legislation on the market for health insurance? Briefly explain the situation for both consumers and producers (i.e. healthcare providers). What might the government do to achieve their intended aims (i.e. lower costs and increased quantity)?Why does the government ass excise taxes to certain products?
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- The graph shows the market for a vital-to-life drug on which the government has imposed a tax of $2 per dose. The buyer pays the entire tax. Draw the demand curve for this drug. Label it D. the demand for the drug. OA. inelastic; the larger is the amount of the tax paid by the buyer of the drug OB. elastic; the more equally is the tax split between the buyer and the seller of the drug OC. elastic; the larger is the amount of the tax paid by the buyer of the drug OD. inelastic; the more equally is the tax split between the buyer and the seller of the drug The more esc @ AAG 2 1 O И/ # 3 C $ 4 % 5 Oll 6 & 7 O * 00 8 O ( 9 12 8- Price (dollars per dose) S+tax 10 Quantity (millions of doses per year) >>> Draw only the objects specified in the question. 0 G 36Suppose that the Australian government imposes a sales tax on a product and both buyers and sellers share the burden of the If the price elasticity of demand for the product is perfectly inelastic. Which of the following is true? Select one: a. Sellers would pay more of the tax than buyers. b. Buyers would pay all of the tax. c. Buyers and sellers would share the tax burden equally. d. Sellers would pay all the tax.3. Using the concept of substitutes and complements, A. explain with the help of a diagram how legalising cannabis may possibly affect the sales of alcohol and cigarettes. B. When the State government evaluates the effect of legalising cannabis on tax revenue, should it look only at the sales of cannabis? Or, should it also consider the changes in the sales of alcohol and cigarettes? This was answered before, but they answered it wrong. https://www.bartleby.com/questions-and-answers/question-1.-with-the-help-of-a-numerical-example-explain-why-california-and-maine-tax-cannabis-by-we/fc31e3c7-6c1b-47ea-b598-5c3c80adacaa At the P labeled in the diagram, it is not at Q nor the Q1 that is labelled.