Author Question: In 1994, the state of California suffered a devastating earthquake. To help pay for the damages, the ... (Read 117 times)

lidoalex · **on:** Jul 1, 2018

In 1994, the state of California suffered a devastating earthquake. To help pay for the damages, the state raised its sales tax by one cent per dollar of expenditure on most consumer goods.

This state sales tax is an example of what economists call: A) an ad valorem tax.
B) a specific tax.
C) a neutral tax.
D) a negative tax.
E) none of the above

Question 2

General Motors estimates that U.S. demand for its newest product will be: Qus = 30,000 - 0.5P. Export demand will be Qex = 25,000 - 0.5P. The total market demand curve for this product will be a

A) straight line with a slope of -0.5.
B) straight line with a slope of -1.0.
C) kinked line with the kink at Q = 25,000.
D) kinked line with the kink at P = 50,000.
E) none of the above