Explain how does the increase in the after-tax price

Assignment Help Macroeconomics

Reference no: EM1328904

Tax incidence determination by elasticity

1. What is "tax incidence"? Describe how a $1 per gallon increase in the gas tax will result in an after-tax price increase that is less than $1

2. How does the increase in the after-tax price depend on the price elasticity of demand and the price elasticity of supply?

3. Burning gasoline creates pollution? Is this pollution a negative externality? If so, use social cost and demand to graphically
depict how you could "correct for the negative externality. ( Just show direction - don't need numbers - Just want to understand how this would look on a graph)

Reference no: EM1328904

Questions Cloud

Show the global process development : Do you find the employee turnover to be any different than in the US? If so, what do you think is the reason? Could more thorough cross-cultural and on-site knowledge of the working culture set different expectations by US management? How would yo..

Organizational analysis of facilities : Discuss the background of both facilities in this area and will provide an organizational analysis of these facilities as well.

Unconstitutional income tax : When did the U.S. Supreme Court rule that income taxes were unconstitutional?

Explain customer satisfaction as a marketing tool : Explain Customer Satisfaction as a Marketing Tool and How can customer satisfaction be used as a marketing tool in an eBusiness

Explain how does the increase in the after-tax price : Explain how does the increase in the after-tax price depend on the price elasticity of demand

The super bowl and their halftime shows : What do you think about the Super Bowl and their halftime shows and commercials the last few years? Shows like this have a true impact on people and they remember them for the rest of their lives.

Explain operations management hierarchy : Capacity planning can have different meanings to individuals at different levels within the operations management hierarchy. Can you explain what some of those differences might be?

Regulating the law : Describe trade regulation and market participant.

Explain regulations in business environment : Explain Regulations in Business Environment and what is the role of government regulations with regard to changes in the business environment

User Account

All Pages