Write a 75-100 word response to each of the bulleted questions below. Each question must have its own response and meet the minimum word count.

Explain how government intervention is a type of implicit taxation.

Why does nearly every purchase you make provide you with consumer surplus? What does this imply regarding trades of 'equal value'?

That is, if you were to purchase your neighbor's lawn mower for $50 and he was to buy your BBQ for $50, is this an exchange of equal values?

Demonstrate the welfare loss of a tax when the supply is highly elastic and the demand is highly inelastic.

If a person has a highly elastic demand, will he likely bear a large or small percentage of the burden of a tax?

If Social Security taxes were paid only by employees, what would likely happen to workers' pretax pay?

If a positive externality exists, does that mean that the market works better than if no externality exists?

It is sometimes said that there is a trade-off between fairness and efficiency. Explain one way in which that is true and one way in which that is false.

In what sense is the tax incentive approach to externalities fair?

Explain why market failure is not necessarily a reason for government intervention.