Microeconomics Chapter 6: Taxes and Subsidies
escape
elasticity = ____
same
exactly the ___ effect whether paid for by sellers or buyers
subsidy
a ___ is a reverse tax where the government gives money to consumers or producers
reverse
a subsidy is a ____ tax
raises
commodity taxation _____ revenue and creates lost gains from trade
total surplus
consumer surplus + producer surplus = ____ ____
elastic
deadweight losses are larger the more ____ the demand curve
increases
subsidies must be paid by taxpayers and they create inefficient ___ in trade (deadweight loss)
tax payers
subsidies must be paid for by ___ ____ and they create inefficient increases in trade (DWL)
received, paid
subsidy = price ___ by sellers - price ___ by buyers
tax revenue
tax * quantity supplied
paid, recieved
tax = price ___ by consumers - price ____ by sellers
demanded
tax buyers for every x ____
commodity tax
tax on goods
supplied
tax sellers for every x ____
decrease
taxes ___ gains from trade
greater
the less elastic side of the market will pay the ___ share of a tax
burden
those who bear the ___ of a tax receive the benefit of subsidy
deadweight loss
total of lost consumer surplus and producer surplus when all mutually profitable gains from trade are exploited
less
when demand is more elastic than supply, demanders pay ___ of the tax than sellers
supply, demand
when speaking of labor, employees = _____ and employers = _____
pays
who ___ a tax does not depend on who must send the check to the government
pays
who ___ the tax does not depend on who writes the check to the government
benefits
who ____ from a subsidy does depend on the relative elasticities of demand and supply
does
who benefits from a subsidy ____ depend on the relative elasticities of demand and supply
not
who gets a subsidy does ____ depend on who gets the check from the government
receives
who gets the subsidy does not depend on who ____ the check from the government
elasticities
who pays the tax depends on the relative ____ of demand and supply
greater
with a subsidy, the price paid to sellers is ___ than the price paid by consumers