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Market Distortions - Taxes and Subsidies Flashcards | StudBud

Explore/Market Distortions - Taxes and Subsidies

A new supply curve that behaves like a shift right of the original supply curve is due to:

A shift right of the supply curve for petrol could be caused by the following

Market Distortions - Taxes and Subsidies

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NCEA Level 1 economics - market distortions

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Questions 8

Answers

1
A shift right of the supply curve for petrol could be caused by the following
Tax being added
The cost of raw materials increases
A subsidy being added
input costs decrease
2
A new supply curve that behaves like a shift right of the original supply curve is due to:
A subsidy being added
Tax being added
The cost of raw materials increases
input costs decrease
3
Which of the following is NOT calculated using the formula (Pe X Qe)
Government revenue before tax
Total consumer spending before tax
Sales before tax
Revenue before tax
4
Which of the following is a reason for government subsidising medication
fair price for the producer
To sell more medication
Change consumer behaviour
To help out the healthcare sector
5
Which of the following is not a reason for imposing a new tax on junkfood?
Change consumer behaviour
Fairness to suppliers of other food products
Gather revenue
Offset the cost of junkfood to society
6
What is the correct formula for finding the cost of a subsidy to the government?
(sub x Qsub)
(sub x Qe)-(sub x Qsub)
(sub x Qe)
(Pe x Qe)-(sub x Qsub)
7
In most cases imposing a subsidy on a good will result in:
Qsub increasing, Psub decreasing
Qsub decreasing, Psub increasing
Qsub increasing, Psub decreasing, Ps increasing
Qsub increasing, Psub increasing, Ps decreasing
8
A movement along the demand curve is caused by:
A change in price
A change in consumer preferences
All three
A change in inputs