This topic contains a solution. Click here to go to the answer

Author Question: Are lump-sum taxes regressive or progressive? Is the deadweight loss of taxation the same for ... (Read 110 times)

JMatthes

  • Hero Member
  • *****
  • Posts: 578
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
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
YES! Correct, THANKS for helping me on my review


tranoy

  • Member
  • Posts: 344
Reply 3 on: Yesterday
:D TYSM

 

Did you know?

The types of cancer that alpha interferons are used to treat include hairy cell leukemia, melanoma, follicular non-Hodgkin's lymphoma, and AIDS-related Kaposi's sarcoma.

Did you know?

Amphetamine poisoning can cause intravascular coagulation, circulatory collapse, rhabdomyolysis, ischemic colitis, acute psychosis, hyperthermia, respiratory distress syndrome, and pericarditis.

Did you know?

Acetaminophen (Tylenol) in overdose can seriously damage the liver. It should never be taken by people who use alcohol heavily; it can result in severe liver damage and even a condition requiring a liver transplant.

Did you know?

Nitroglycerin is used to alleviate various heart-related conditions, and it is also the chief component of dynamite (but mixed in a solid clay base to stabilize it).

Did you know?

Glaucoma is a leading cause of blindness. As of yet, there is no cure. Everyone is at risk, and there may be no warning signs. It is six to eight times more common in African Americans than in whites. The best and most effective way to detect glaucoma is to receive a dilated eye examination.

For a complete list of videos, visit our video library