Suppose the demand curve for a good is highly elastic and the supply curve is highly inelastic. If the government taxes this good,
a. buyers and sellers will each share 50 percent of the burden, regardless of the elasticities of the demand and supply curves.
b. sellers will bear a larger share of the tax burden.
c. the distribution of the burden will depend upon whether the buyers or the sellers are required to send the tax to the government.
d. buyers will bear a larger share of the tax burden.
B
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Tampering with the price mechanism
a. can be efficient for a while. b. cannot be attempted in a market economy. c. can enhance societal welfare if done properly. d. often produces undesired side effects.
The basic economic problem is
a. how to become wealthy b. how to save the planet from pollution c. how to equally distribute income d. meeting people's wants and needs in a world of scacity