This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Are lump-sum taxes regressive or progressive? Is the deadweight loss of taxation the same for ... (Read 87 times)

JMatthes

  • Hero Member
  • *****
  • Posts: 578
on: Jun 29, 2018
Are lump-sum taxes regressive or progressive? Is the deadweight loss of taxation the same for different types of taxes?
 
  What will be an ideal response?

Question 2

Refer to Figure 5-2. The marginal benefit of the last unit produced is represented by the price
 
  A) Pa. B) Pb. C) Pc. D) Pf.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

cclemon1

  • Sr. Member
  • ****
  • Posts: 312
Reply #1 on: Jun 29, 2018
Answer to Question 1

Lump-sum taxes force the rich and the poor people to pay the same amount  and thus impose a higher tax rate on the poor. Therefore, they are an example of regressive taxes. Not all taxes lead to a deadweight loss. With lump-sum taxes, all citizens in an economy would pay the government the same amount regardless of their earnings or market demand. Since they will pay the same amount in a lump-sum tax no matter what they do, the lump-sum tax does not distort their decisions. Since such taxes do not distort decisions, they do not lead to a deadweight loss. There are very few examples of real world lump-sum taxes and so virtually all taxes that people actually pay do lead to deadweight losses.

Answer to Question 2

B


JMatthes

  • Member
  • Posts: 578
Reply 2 on: Jun 29, 2018
Excellent

abro1885

  • Member
  • Posts: 337
Reply 3 on: Yesterday
:D TYSM

« previous next »
 

Did you know?

Although puberty usually occurs in the early teenage years, the world's youngest parents were two Chinese children who had their first baby when they were 8 and 9 years of age.

Did you know?

For pediatric patients, intravenous fluids are the most commonly cited products involved in medication errors that are reported to the USP.

Did you know?

Though methadone is often used to treat dependency on other opioids, the drug itself can be abused. Crushing or snorting methadone can achieve the opiate "rush" desired by addicts. Improper use such as these can lead to a dangerous dependency on methadone. This drug now accounts for nearly one-third of opioid-related deaths.

Did you know?

More than 34,000 trademarked medication names and more than 10,000 generic medication names are in use in the United States.

Did you know?

If you use artificial sweeteners, such as cyclamates, your eyes may be more sensitive to light. Other factors that will make your eyes more sensitive to light include use of antibiotics, oral contraceptives, hypertension medications, diuretics, and antidiabetic medications.

Multiple sclerosis (MS). (a) A disease characterized by the gradual development of small areas of ha Multiple sclerosis (MS). (a) A disease characterized by the gradual development of small areas of ha
Activity, Food Restriction, and Weight Loss Activity, Food Restriction, and Weight Loss
Adding Volume to Your Meals Aids Weight Loss Adding Volume to Your Meals Aids Weight Loss
Loud Music and Hearing Loss (1 of 2) Loud Music and Hearing Loss (1 of 2)
How to calculate the gain and loss gene numbers with low bootstrap of phylogenetic tree? How to calculate the gain and loss gene numbers with low bootstrap of phylogenetic tree?
An overview of the 5 types of gain, loss, or rearrangement of chromosome An overview of the 5 types of gain, loss, or rearrangement of chromosome
Video: Coaductile pathway, Timing of contraction signal & Conduction system and ECG

For a complete list of videos, visit our video library