HomeworkLib
Question

1. Suppose the local government is thinking of ways to raise revenues. One proposal is to...

1. Suppose the local government is thinking of ways to raise revenues. One proposal is to increase the tax on grocery items. Would higher grocery prices lead to fewer groceries bought?

yes

no

2. Explain your response to the previous question using economic reasoning.

3. Would higher grocery prices be equitable between rich and poor households?

yes

no

4. Explain your response to the previous question using economic reasoning.
business   economics   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1

For question 1 -

Statement - Suppose the local government is thinking of ways to raise revenues. One proposal is to increase the tax on grocery items. Would higher grocery prices lead to fewer groceries bought?

Answer - Yes

Explanation - A tax on grocery items is a kind of indirect tax. Although this might lead to the government earning more per item sold, it will also lead to a fall in the demand of the grocery items. This follows the demand curve where as the price of the product increases, the people who could afford it at the new increased price go down, and hence the demand of the item goes down as well.

0 0
Add a comment
Know the answer?
Add Answer to:
1. Suppose the local government is thinking of ways to raise revenues. One proposal is to...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • A. The government is exploring ways to increase revenues through taxation. Lisette is an economic adviser...

    A. The government is exploring ways to increase revenues through taxation. Lisette is an economic adviser to public policy makers, and they pose to her the following question: Should the government tax yachts or should it tax gasoline? Explain your answer using price elasticity of demand. B. Esther is a politician who promises cheaper gasoline for everyone in the country if she is elected. Once she is elected, she makes gas cheaper by imposing a price ceiling that is one...

  • 22. 3D printers are a new technology. Basically, the user simply pours powder into the machine, then the software will t...

    22. 3D printers are a new technology. Basically, the user simply pours powder into the machine, then the software will tell the machine what to produce. Some 3D printers can make simple things like small food containers, while the more sophisticated ones can even make human artificial ears and hearts! Question: Once these 3D printers become so common that almost everyone will own one (perhaps 15 years from now), then which cost factor(s) listed below should go down?   Labor costs...

  • 1.Expected inflation for the next year is 2.0%. The posted one-year interest rate on bonds is...

    1.Expected inflation for the next year is 2.0%. The posted one-year interest rate on bonds is 5.0%. a.What is the (ex-ante) real interest rate?_________ b.Inflation turns out to be 1.5%. What is the (ex-post) real interest rate that the borrow paid/lender received? _____________ c.Is the lender better off or worse off? _______________________ 2.Spartan Spaces creates room set-ups for college dorms. Spartan Spaces purchases Bedding for room set-ups from companies in the US for $8,000; wall shelving for room set-ups from...

  • 21. In the U.S. many firms that publicly trade stocks are under tremendous pressure each quarter...

    21. In the U.S. many firms that publicly trade stocks are under tremendous pressure each quarter (every three months) to report higher profits, sales, and/or growth. If they can’t, then their stock price often will get hit hard and go down as investors dump those stocks. Question: What kind of executive decision making will this type of business environment encourage? Executives will be encouraged to make good long-run cost choices like investing in new machinery and retraining workers to give...

  • Read article on the minimum wage: To complete this activity: 1. Prepare a response to the...

    Read article on the minimum wage: To complete this activity: 1. Prepare a response to the following discussion prompts, based on the article: Help the Working Poor, but Share the Burden.(see attached) (a) Discuss the costs and the benefits associated with increasing the minimum wage. (b) If you were are congressional member and had to vote on an increase in the minimum wage to say $10 per hour would you? Why or why not? Help the Working Poor, but Share...

  • QUESTION 1 Economists use the word marginal to mean 1. A decision that is only secondary...

    QUESTION 1 Economists use the word marginal to mean 1. A decision that is only secondary in importance. 2. The extra benefit or cost of a decision. 3. When firms concentrate on their profit margin. 4. When an economy is producing efficiently. 5 points    QUESTION 2 Economists use the word rationality to mean.... 1. When people correctly analyze a situation and come to the best decision possible. 2. Only a hypothetical scenario, people are never really rational. 3. When...

  • 1. Suppose you make silver jewelry. If the price of silver wire (a raw material) falls,...

    1. Suppose you make silver jewelry. If the price of silver wire (a raw material) falls, we would expect you to: a. be willing and able to produce less jewelry than before at each possible price. b. be willing and able to produce more jewelry than before at each possible price. c. face a greater demand for your jewelry. d. face a weaker demand for your jewelry. _____ 2. Consider the market for portable air conditioners, initially in equilibrium. When...

  • Question 50 (1 point) A(n) _____ in oil prices and a(n) _____ in taxes will shift...

    Question 50 (1 point) A(n) _____ in oil prices and a(n) _____ in taxes will shift short-run aggregate supply to the left. Question 50 options: a) decrease; increase b) decrease; decrease c) increase; decrease d) increase; increase Question 51 (1 point) Which of the following events will shift the aggregate demand curve to the right? Question 51 options: a) an increase in household debt b) a catastrophic hurricane hitting the northeastern United States c) a decrease in taxes d) a...

  • 1. Given the information in Table 1, in a two country and two-product Ricardian model, which...

    1. Given the information in Table 1, in a two country and two-product Ricardian model, which of the following statements is (are) true? Table 1 Unit Labour Requirements T-shirt Brandy 4 hours 12 hours 6 hours 12 hours United States France A) The pretrade price ratio in France is 1 brandy - 2 T-shirts. B) The US pretrade price ratio is 1 brandy - 4 T-shirts. C) The US pretrade price ratio is 1 T-shirt = 1/3 brandy. D) The...

  • macroeconomic please solve it all i need help 8. If the price of coffee decreases, all...

    macroeconomic please solve it all i need help 8. If the price of coffee decreases, all else held coestant, the Law of Demand states that a firms will produce more coffee b. people will buy more coffee 9. If the price of coffee decreases, all else held constant, the Law of Supply states that a firms will produce more coffee b. people will buy more coffee e. firms will produce less coffee d people will buy more milk shakes c....

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT