Tax and Sub

Which of the following is an indirect tax

• income tax

• corporation tax

• capital gains tax

• VAT

A tax that rises with the price of a good is a....

• specific tax

• direct tax

• progressive tax

• ad valorem tax

If a good is ped inelastic the bigger burden of the tax will be on the

• consumer

• producer

• government

• employee

which of the following is NOT an impact of a tax rise

• reduced producer surplus

• tax revenue

• reduced consumer surplus

• lower prices

A subsidy is a

• govt grant to increase production

• govt grant to raise price

• govt grant to increase costs

• govt grant to cut spending

consumer surplus refers to the

• diff between market price and what consumer prepared to pay

• diff between price producer willing to sell good for and market price

• price consumer willing to sell good for

• market price

which of the following is not a benefit of subsidies

• lower price

• provision of goods with external benefits

• opportunity cost of govt spending

• increased production

PES measures the

• responsiveness of supply to a change in price

• responsiveness of price to a change in supply

• responsiveness of demand to a change in price

• responsiveness of demand to a change in income

The impact of a subsidy will be larger on who if the good is ped elastic?

• Producer

• Consumer

• Government

• Employee

producer surplus refers to the difference between

• the price consumers are prepared to pay for the good and the price they

• the price producers are prepared to sell the good for and the price they actually pay

• the price producers are prepared to sell the good for

• the retail price