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Author Question: An effective price ceiling tends to A) increase quantity supplied. B) decrease quantity ... (Read 43 times)

justinmsk

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on: Jun 29, 2018
An effective price ceiling tends to
 
  A) increase quantity supplied.
  B) decrease quantity demanded.
  C) leave quantity supplied and demanded unchanged.
  D) do none of the above.

Question 2

Explain the equity-efficiency trade-off. Give an example of conflicting equity and efficiency outcomes of a policy.
 
  What will be an ideal response?


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Jossy

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Reply #1 on: Jun 29, 2018
Answer to Question 1

D

Answer to Question 2

The equity-efficiency trade-off refers to the trade-off between ensuring an equitable distribution of resources (equity) and increasing social surplus or total output (efficiency). A progressive tax system helps in the redistribution of income from the rich to the poor and ensures greater equity. However, it discourages the rich to work and save more.


justinmsk

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Reply 2 on: Jun 29, 2018
Gracias!

jomama

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Reply 3 on: Yesterday
Excellent

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