Chapter 6: Taxes, Price Controls, and Quantity Regulations

These flashcards cover key concepts related to taxes, government intervention, and market outcomes from Chapter 6 lecture notes.

Government Intervention in Markets

The influence of laws, regulations, and taxes on the supply and demand that determine quantity and price at which goods are sold.

Soda Tax

A tax imposed on sugar-sweetened beverages to reduce consumption by increasing their price.

Statutory burden

The legal responsibility assigned for paying a tax to the government.

Economic burden

The actual cost borne by individuals or entities as a result of a tax, which may differ from the statutory burden.

Tax incidence

The distribution of the tax burden between buyers and sellers in a market.

Elasticity

A measure of how much the quantity demanded or supplied responds to changes in price.

Inelastic

A condition where the quantity demanded or supplied is relatively unresponsive to price changes.

Price Regulation

Government-imposed limits on the prices that can be charged for goods and services.

Quantity Regulation

Government-imposed limits on the amount of a good that can be produced or consumed.

Minimum Wage

A legal requirement that sets the lowest hourly wage rate that can be paid to workers.