CHAPTER 12 - Taxation and e Distribution Multiple-Choice Questions 1. Statutory incidence of a tax deals with a) the amount of revenue left over after taxes. b) the amount of taxes paid after accounting for inflation. c) the person(s) legally responsible for paying the tax. d) the amount of tax revenue generated after a tax is imposed. e) none of the above. 2. Taxes a) are mandatory payments. b) are necessary for financing government expenditures. c) do not directly relate to the benefit of government goods and services received. d) are all of the above. 3. General equilibrium refers to a) examining markets without specific information. b) finding equilibrium from general information. c) pricing goods at their shadow price. d) all of the above. e) none of the above. 4. A demand curve that is perfectly inelastic is a) horizontal. b) vertical. c) at a 45 degree angle. d) parallel to the X-axis. 5. In 2002, the top 1% of all e earners paid _________ percent of federal taxes. a) b) c) d) e) 6. A tax on suppliers will cause the supply curve to shift a) up. b) down. c) right. d) left. e) in none of the above directions. 7. A monopoly has ______ seller(s) in the market. a) 0 b) 1 c) 3 d) many e) all of the above 8. An ad valorem tax is a) given as a proportion of the price. b) Latin for “buyer beware.” c) identical to
