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Author Question: What is the advantage of the government imposing an ad valorem tax over a specific tax when facing a ... (Read 55 times)

altibaby

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on: Jul 1, 2018
What is the advantage of the government imposing an ad valorem tax over a specific tax when facing a monopoly?
 
  What will be an ideal response?

Question 2

In 1950 there were 16 individuals contributing to Social Security for every one person collecting benefits.
 
  a. True b. False


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brbarasa

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Reply #1 on: Jul 1, 2018
Answer to Question 1

When comparing an ad valorem tax to a specific tax which generates the same revenue, the ad valorem tax is less distortionary, resulting in a smaller DWL.

Answer to Question 2

a


altibaby

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Reply 2 on: Jul 1, 2018
Great answer, keep it coming :)

Sarahjh

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Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

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