Suppose the demand for saline solution is perfectly inelastic for contact lens wearers
If the government imposes a tax on saline solution, what occurs? Be sure to tell what happens to the price paid by the buyers and discuss the incidence of the tax.
If demand is perfectly inelastic, then no matter what the price, buyers will not decrease their quantity demanded when the price rises. Hence the tax will be passed along entirely to the consumers. So, in the case of saline solution, the price paid by the buyers will rise by the full amount of the tax and so buyers pay the entire amount of the tax.
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Which statement is false?
A. Most poor women who get pregnant do so to get on welfare. B. Most long-term poor people are black. C. The causes of black poverty are not always the same as those of white poverty. D. None of these statements are false.
The demand for capital by a firm is based on the demand for the product that the capital produces. This relationship is referred to as
A. cost minimization. B. resource utilization. C. derived demand. D. product demand.