When taxation becomes excessive, many firms ______________. Additionally excessively taxed firms ______________. Moreover, a wealth tax (a tax on (already taxed) assets rather than on new income) requires _____________. It’s politicians without an economic background pursing these policies virtually ignoring ______________ and focusing solely on spending.Happily pay it with little or no resistance; often make more money (according to noted economist Paul Krugman); no effort since all wealth is sitting in actual paper money in Cayman Island bank accounts; the wealth that miraculously just falls from the sky.Use illegal means to avoid tax; hire more people; donations from workers; wealth creation.Respond in ways (misallocating resources, tax avoidance strategies) that creates more wealth overall; hold more resources for future expansion and wealth creation; the purchase for cash of income earning assets such as machinery or farmland; wealth use.Respond in ways (misallocating resources, tax avoidance strategies) that creates less wealth overall; hold fewer resources for future expansion and wealth creation; the sale for cash of income earning assets such as machinery or farmland; wealth creation

Introducing a specific tax generates excess demand on the market.

Raising taxes too high can result in a slowdown of economic activity.TrueFalse

Imposing taxes that increase as a firm's pollution increases is often recommended by economists as a means to reduce pollution. The reason for this recommendation is that such taxes would likely aeliminate pollution completely bencourage firms to use the most efficient method to reduce pollution cbe paid out of firm's profits and not paid for by higher consumer prices dencourage firms to increase production

Assume the economy is at full employment and that investment spending declines dramatically. If the goal is to restore full employment, government fiscal policy should be directed towardMultiple Choicean equality of tax receipts and government expenditures.a reduction of subsidies and transfer payments and an increase in tax rates.an excess of tax receipts over government expenditures.an excess of government expenditures over tax receipts.

The UK government feels there is a decline in total consumptionreducing AD. For this reason, it decides to buy physical assets ownedby banks. This is an example of a Fiscal policy.2. Government spending on final goods and services is an injection intothe economy.3. Air passenger duty is an example of a direct tax.4. A Proportional tax system involves the average rate of taxationdeclining as income rises.5. The Slovakian govt has a total of $5Billion which it sources from taxesand other revenue sources in 2019. Total government expenditure (𝐺)is $5.5Billion for the same year. This is an example of deficitfinancing.Section B: Discussion QuestionsI. Show the effect of higher interest rates on AD.II. Are supply-side policies superior to demand-side policies? Givereasons for your answer.