Suppose Ausland's spending for the year can be described by the table below: Construction of New Housing $50 Private Consumption $650 Government Spending on Public Goods and Services $400 Private Acquisition of Capital Goods $160 Exports $100 GST Revenue $20 Imports $80 Marginal Propensity to Consume 0.6 Marginal Tax Rate 0.25 Marginal Propensity to Import 0.05 What is the value of Ausland's Investment (I) expenditure? Select one: O a. $50 b. $350
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- Macmillan Learning Suppose that a city government introduces a $0.50 excise (commodity) tax on consumers of bottles of soda to improve the health of its citizens. Manipulate the accompanying graph to demonstrate the impact of the tax on the market for soda. What would be the new equilibrium quantity if instead of taxing consumers, the city taxed producers? 5.0 4.5 4.0 3.5 Market for Bottles of Soda thousand bottles Price ($/bottle) 3.0 2.5 2.0 1.5 1.0 0.5 0.0 0 1 2 5 6 3 4 Quantity (thousands of bottles) D 7 8 9 10Class Activity - X Class Activity i ces + O8 https://ezto.mheducation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl=https%253A%25 Year Average Income 1 2 3 4 The table shows the average income of households and the quantity demanded of products M and N at different prices and leve income. Saved Quantity of M 105 95 85 95 $44,000 44,000 44,000 50,000 Price of M $2.40 2.70 2.70 2.70 a) What is the price elasticity of demand for product M between years 1 and 2? Round your answers to 2 decimal places. 087 52Fnewconnec Price of N $18 18 26 26 Quantity of N 820 800 780 810 b) What is the price elasticity of demand for product N between years 2 and 3? Round your answers to 2 decimal places. c) What is the income elasticity of demand for product M between years 3 and 4? Round your answers to 2 decimal places18_Which of the following is an example of a direct tax? Check all that apply. A tax placed directly on alcohol to discourage people from drinking A tax placed directly on cigarettes to encourage people to stop smoking Income tax A poll or head tax that charges everyone the same euro amount Which of the following choices represent excise taxes? Check all that apply. A tax of an absolute sum levied on every person or every household The 20% value added tax on a €60,000 Porsche A tax levied on business profits Social Security taxes The 60 pence per-litre unit tax on petrol purchased at a pump in the UK True or false: Any form of an excise tax is a regressive tax. False True
- Figure 8-24. The figure represents the relationship between the size of a tax and the tax revenue raised by that tax. Tax Revenue F 765YMN1 Refer to Figure 8-24. For an economy that is currently at point D on the curve, a decrease in the tax rate would a decrease consumer surplus. b. decrease producer surplus. c. increase tax revenue. d. increase the deadweight loss of the tax. Tax SizeMatch the term to its correct definition. Column A 1. 2. 3. 4. 5. 67 8. a tax for which the percentage of income paid in taxes increases as income increases a tax on the value of a property a tax for which the percentage of income paid in taxes remains the same for all income levels a tax for which the percentage of income paid in taxes decreases as income increases a tax on the dollar value of a good or service being sold a tax on the estate, or total value of the money and property, of a person who has died a tax on the production or sale of a good a tax on a person's earnings % 5 Column B a. progressive tax b. estate tax C. property tax d. regressive tax e. income tax f. excise tax g proportional tax h. es taxPlan A • Consumption up to 1,000 coconuts is taxed at 50%. • Consumption higher than 1,000 coconuts is taxed at 20%. Consumption Level (Quantity of coconuts) Use the Plan A and Plan B tax schemes to complete the following table by deriving the marginal and average tax rates under each tax plan at the consumption level of 600 coconuts, 1,200 coconuts, and 2,500 coconuts, respectively. Plan A 600 1,200 2,500 Plan B Plan A Plan B Consumption up to 2,000 coconuts is taxed at 10%. • Consumption higher than 2,000 coconuts is taxed at 25%. Marginal Tax Rate (Percent) ● Plan B Complete the following table by indicating whether each plan is a progressive tax system, a proportional tax system, or a regressive tax system. Progressive Proportional Regressive Average Tax Rate Marginal Tax Rate Average Tax Rate (Percent) (Percent) (Percent)
- Figure 8-23. The figure represents the relationship between the size of a tax and the tax revenue raised by that tax. 6 on4m21 3 Tax Revenue B Tax Size Refer to Figure 8-23. If the economy is at point A on the curve, then a small increase in the tax rate will O increase the deadweight loss of the tax and increase tax revenue. O increase the deadweight loss of the tax and decrease tax revenue. decrease the deadweight loss of the tax and increase tax revenue. O decrease the deadweight loss of the tax and decrease tax revenue.4. The Laffer curve Government-imposed taxes cause reductions in the activity that is being taxed, which has important implications for revenue collections. To understand the effect of such a tax, consider the monthly market for cigarettes, which is shown on the following graph. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. PRICE (Dollars per pack) 20 18 16 14 Supply Demand 0 20 40 60 80 100 120 140 160 180 200 QUANTITY (Packs) Suppose the government imposes a $4-per-pack tax on suppliers. At this tax amount, the equilibrium quantity of cigarettes is Graph Input Tool Market for Cigarettes Quantity (Packs) Demand Price (Dollars per pack) Tax (Dollars per pack) 80 12.00 4.00 Supply Price (Dollars per pack) packs, and the government collects $ (?) 8.00 in tax revenue.a greatera smallerdecrease in government spendingdecrease in net taxesincrease in government spendingincrease in net taxesnono change in government spendingno change in net taxes
- lew previoUs attens Assume that In year 1 you pay an average tax rate of 25 percent on a taxable Income of $50,000. In year 2, you pay an average tax rate of 30 percent on a taxable Income of $75,000. Assuming no change in tax rates, the marginal tax rate on your additional $25,000 of income is Multiple Choice 3 percent. 40 percent 35 percent 20 percentAssume the government taxes packs of cigarettes both to discourage cigarette smoking and to raise tax revenue. The average excise tax on a pack of cigarettes is $2.50 per pack. The table below presents the annual demand and supply schedules, In billions of packs. both before and after the tax on packs of cigarettes. Market for Cigarettes Price (dollars par pack) $10.00 9.75 9.50 9.29 8.75 8.58 8.25 3.08 7.75 7.58 7.25 7.08 6.75 6.58 4.25 6.00 5.75 5.58 9.25 5.00 4.75 4.50 Quantity of Cigarettes Demanded (Dillions of packa) 5.0 7.5 10:0 12.5 15.0 17.5 28.0 22.5 25.0 27.5 32.5 39.0 37.5 42.5 45.8 47.5 50.0 52.5 55.0 57.5 60.0 Quantity of cigarettes supplied (billions of packs) 65.0 62.5 60.0 57.5 52.9 50.0 47.5 45.0 42.5 37.5 35.0 32.5 30.0 27.5 25.0 22.5 28.0 $2.50 per pack $0.50 per pack $1.75 per pack $700 Ft paci 17.5 15.0 12.5 18.0 Quantity of Cigarettes Supplied with Tax (billiona of packs) 49.0 37.5 35.0 32.5 30.0 27.5 25.8 22.5 28.8 17.5 15.8 12,5 18.0 a. What are the equilibrium…A challenger presidential candidate vows to cutentitlement spending by 20 percent in the first fewweeks that he is in office. Why is it unlikely thecandidate could achieve this reduction?