Question 1
Which of the following taxes would impose the smallest excess burden on an individual?
◦ a tax on Diet Pepsi
◦ a tax on all diet beverages
◦ a tax on all soft drinks
◦ a tax on all types of beverages, including water
Question 2
The total burden of the tax is
◦ the revenue collected from the tax minus the excess burden created by the tax.
◦ the excess burden created by the tax minus the revenue collected from the tax.
◦ the sum of the revenue collected by the tax and the excess burden created by the tax.
◦ the ratio of the revenue collected and the excess burden created by the tax.