Distinguish between legal and economic tax incidence; Know how to represent taxes by shifting the curve and the wedge method; Understand the quantity and price affect from a tax; Describe why both taxes and subsidies cause deadweight loss

2024年2月28日 · A subsidy is a direct or indirect payment to individuals or firms, usually in the form of a cash payment from the government or a targeted tax cut. In economic theory, subsidies can be used...

2019年11月30日 · Diagrams to explain the effect of subsidies on price, output and consumer surplus. How the effect of subsidies depends on elasticity of demand. Impact on externalities and social welfare.

2024年10月29日 · Revision notes on Indirect Taxes & Subsidies for the Edexcel A Level Economics A syllabus, written by the Economics experts at Save My Exams.

2023年12月17日 · So, let's dive in and unravel the complexities of taxes and subsidies, and how they play a crucial role in the world of economics. To begin with, let's define what taxes and subsidies are. Taxes are fees imposed by the government on individuals or businesses to generate revenue for public services.

•Taxes generate revenue for government; subsidies require an expenditure by government. • Both policies create inefficiency (Deadweight Loss) by squashing mutually beneficial trades or inducing negative sum trades.

A subsidy is just a negative tax: so instead of the price paid by consumers being the price received by firms plus a tax, it’s the price received by firms minus a subsidy. As a result, the quantity is greater than the equilibrium quantity without a subsidy.

In this course, and for this section in particular, we will consider only taxes levied on consumption. These taxes are typically enforced on a state level in the US, and can take 2 forms: An excise tax levies a fixed dollar amount on a particular good or service. A flat $1 tax per packet of cigarette sold is an example of an excise tax.

Taxes are monetary costs levied by governments on individuals and firms that are collected from their income or revenue to be transferred to the public sector. Subsidies are direct and indirect payments provided by the government to individuals and firms to give the recipients a financial incentive to pursue a certain objective.

Learn all about Tax and Subsidies in A-Level Economics with our comprehensive guide. From understanding the different types of taxes to exploring the impact of government subsidies, our expertly crafted resources will help you excel in your studies.