For a given supply curve, how does the elasticity of demand affect the burden of a tax imposed on a product?
A) The excess burden of the tax will be greater when the demand is more elastic than when it is less elastic.
B) The excess burden of the tax will be greater when the demand is less elastic than when it is more elastic.
C) The excess burden of the tax will be minimized when the demand is unit elastic.
D) The excess burden of the tax will be greater when the elasticity of supply is greater than the elasticity of demand.
A
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Ann Trepreneur was formerly a landlord, renting her building for $1,200 a month. She now uses her building for her own florist shop. Pick the true statement
A) The building costs Ann $1,200 per month. B) Ann incurs no opportunity cost on the building. C) Ann uses the building as a free good. D) None of the above is true.
Incentives for borrowers and savers in the loanable funds market are determined by the nominal interest rate as opposed to the real interest rate
a. True b. False Indicate whether the statement is true or false