Explain how corporate profits are taxed twice. Explain why marginal revenue is so important to any firm. Why would elasticity of demand be important to determine if you should levy a tax on luxury products? Explain why an economy's income must equal its expenditure. ...
Briefly explain why lump-sum taxes are considered to be non-distorting. Lump-sum taxes: When a producer produces certain amount of goods, he bears certain costs. When government put taxes on his production, it affects its costs. However, the lump-sum taxes are independent of the ...