Indicate whether each of the following statements is true, false, or uncertain, and explain your answer.  Your grade will depend primarily on the quality of your explanation.

1. The higher the interest rate used to discount future benefits, the more valuable the benefits appear today.

2. A commodity tax that raises no tax revenue creates no dead weight loss.

3.  Commodity taxes on goods with completely inelastic market demand curves are efficient because analytically they create no excess burden.

4. Efficiency is maximized when all commodities are taxed at the same rate.

5. Average cost pricing for a natural monopoly allows the enterprise to break even, but the outcome is inefficient. 

 

 

Posted Date: 3/14/2013 1:19:14 AM | Location : United States

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