microecon exam 3

with free trade, consumer surplus is

$1600 and producer surplus is $200

suppose the government imposes a tariff of $10 per unit. with trade and a tariff, total surplus is

$950

if willie has $170,000 in taxable income, his average tax rate is

24.3%

what is the average tax rate for a person who makes $60,000?

30%

what is the marginal tax rate for a person who makes $60,000?

50%

a city street is

a common resource when it is congested, but it is a public good when it is not congested

the term market failure refers to

a market that fails to allocate resources efficiently

Excludability is the property of a good whereby

a person can be prevented from using it

Tax systems that impose recordkeeping requirements on taxpayers are said to have an

administrative burden

The market for soybeans in Canada consists solely of domestic buyers of soybeans and domestic sellers of soybeans if

canada forbids international trade in soybeans

emission controls on automobiles are an example of a

command-and-control policy to increase social efficiency

the box labeled C represents

common resources

Private markets fail to account for externalities because

decisionmakers in the market fail to include the costs of their behavior to third parties

In designing a tax system, policymakers have two objectives that are often conflicting. They are

efficiency and equity

with trade, guatemala will

export 22 units of coffee

Relative to a no-trade situation, trade with the rest of the world results in

guatemalan consumers paying a higher price for coffee

if the world price of apples is higher than argentina's domestic price of apples without trade, then argentina

has a comparative advantage in apples

the largest source of income for the federal government is

individual income taxes

"Owners of firms in young industries should be willing to incur temporary losses if they believe that those firms will be profitable in the long run." This observation helps to explain why many economists are skeptical about the

infant industry argument

the Tragedy of the Commons results when a good is

neither rival in consumption nor excludable

Both public goods and common resources are

nonexcludable

state and local governments receive the largest portion of their tax revenues from

sales and income taxes

a tax on an imported good is called a

tariff

an externality is

the uncompensated impact of one person's actions on the well-being of a bystander

the graph represents a market in which

there is a negative externality