Questions from Microeconomics

Q: In 2012, Congress and President Barack Obama passed legislation raising tax

In 2012, Congress and President Barack Obama passed legislation raising tax rates on families earning $450,000 or more. Did this change in the law make the U.S. tax system more progressive or less pro...

Q: What is the difference between a marginal tax rate and an average

What is the difference between a marginal tax rate and an average tax rate? Which is more important in determining the effect of a change in taxes on economic behavior?

Q: In a market economy, why does a f irm have a

In a market economy, why does a f irm have a strong incentive to be productively efficient and allocatively efficient? What does the firm earn if it is productively and allocatively efficient, and wha...

Q: Dane decides to give up a job earning $200,000

Dane decides to give up a job earning $200,000 per year as a corporate lawyer and converts the duplex that he owns into a UFO museum. (He had been renting out the duplex for $20,000 a year.) His expli...

Q: When Apple first launched Apple Music, singer Taylor Swift refused to

When Apple first launched Apple Music, singer Taylor Swift refused to allow her album 1989, which had been the bestselling album of 2014, to be made available for the service because Apple did not int...

Q: Movie studios split ticket revenues with the owners of the movie theaters

Movie studios split ticket revenues with the owners of the movie theaters that show their films. An article in the Wall Street Journal in 2015 discussed how the Disney studio was attempting to negotia...

Q: If the United States were to stop trading goods and services with

If the United States were to stop trading goods and services with other countries, which U.S. industries would be likely to see their sales decline the most? Briefly explain.

Q: Briefly discuss each of the five goals and principles governments consider when

Briefly discuss each of the five goals and principles governments consider when deciding which taxes to use.

Q: Suppose that a large oil field is discovered in Michigan. By

Suppose that a large oil field is discovered in Michigan. By imposing a tax on the oil, the state government is able to eliminate the state income tax on wages. What is likely to be the effect on the...

Q: An article in a Federal Reserve publication notes that “nearly all

An article in a Federal Reserve publication notes that “nearly all taxes create some market ineff iciency in the form of deadweight loss.” The article notes that when something is taxed, the result is...