Explain excess profits tax

Assignment Help Microeconomics
Reference no: EM13175615

In the 1970s Congress imposed an "excess profits tax" on these companies. It did not do so this time? What does this change show about how our understanding of the way the price system works to allocate resources has evolved? If "excess profits" are taxed away, where will oil companies get the money to fund new exploration and development of oil properties? Does it matter if these price increases are demand or supply induced?

Reference no: EM13175615

Questions Cloud

Open system at equilibrium with normal atmospheric levels : open system at equilibrium with normal atmospheric levels of carbon dioxide to show the approximate PH of pure rain water, assuming Pco2=10^-3.5 atm?
Define and construct a frost circle for imidazole : Construct a frost circle for imidazole with one 2p orbital on each atom of the ring, and show relative energy of all pi molecular orbitals. fill in the appropriate number of electrons
What is the price elasticity of demand : When the price of a good is $5, the quantity demanded is 100 units per month; when the price is $7, the quantity demanded is 80 units per month. What is the price elasticity of demand, using the midpoint method?
State the flask was not thoroughly wiped dry : If an insufficient amount of liquid unknown had been used, how would this have affected the value of the experimental molar mass?
Explain excess profits tax : If "excess profits" are taxed away, where will oil companies get the money to fund new exploration and development of oil properties? Does it matter if these price increases are demand or supply induced?
Explain the expansion of an ideal gas in a vacuum : The expansion of an IDEAL GAS in a vacuum. Is it an endothermic process
What will happen to the space between the helium atoms : If you open the valve on the tank and release the helium into a room with a volume of 10,000 liters, what will happen to the "space" between the helium atoms? Clearly explain
Explain legacy regarding the federal reserve : Discuss the background of Federal Reserve's Chairman Ben Bernanke in detail including his educational background to his accomplishments to his role in running the Fed. What is his legacy regarding the Federal Reserve?
Short term frame impact on long term frame : The SEC regulations require u.s. corporations to publish operating results on a quarterly basis. How does this short term time frame impact long term profit maximization?

Reviews

Write a Review

Microeconomics Questions & Answers

  Determine challenger minimum cost of life

VMIC Corporation has asked you to look at the following data. The interest rate is 10 percent.

  Determining monopoly output decision

Here is the information you require to answer the question. This information is taken from the graph. So you will require to draw the graph to answer the questions. The best level of output for monopolist in short run is 500 units and is given by p..

  What effect will have on output

Suppose the price of labor increases to $2 per unit. What effect will this have on output per unit of labor and is this plant subject to decreasing returns to scale? Why or why not?

  How great employers select and take care of their talent

What can the company do to improve its overall compensation, benefits and professional development practices to enhance the staff's overall effectiveness in meeting the mission and needs of the company?

  Which price constitute firm 2''s optimal commitment strategy

Which price constitutes firm 2's optimal commitment strategy? Justify your answer and explain why it makes sense.

  Question on pricing and output decisions

Indicate whether each of the following statements is true or false and explain why. a) A competitive firm that is incurring a loss should immediately cease operations.

  Details of price discrimination

M is the monopolist selling goods G. M's cost function is c(y)=4y where y is total production of G. Some of M's potential customers are members and get the member magazine with coupons.

  Developing the drug and obtaining fda approval

Despite strong sales and a low marginal cost of producing the product, your company has yet to show a profit from selling the drug.

  What is eddies consumer surplus

What is the profit maximizing output if the price and What is the maximum profit that can be achieved - What is the marginal product of the 3rd worker

  Increase in unemployment benefits

Assume that the unemployment profits provided through the private sector are raised permanently,

  Determining maximin decision rule

Although Ken Brown (discussed in problem 3-16) is the principal owner of Brown Oil, his brother Bob is credited with making the company a financial success. Bob is vice president of finance.

  Pigouvian tax-externalities

The private marginal benefit for commodity X is given by 10 - X where X is the number of units consumed. The private marginal cost of producing X is constant at $5. For each unit of X produced, an external cost of $2 is imposed on members of socie..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd