If the demand for a good is highly inelastic, a tax on the good
a. places the burden of the tax equally on buyers and sellers
b. permits sellers to pass most of the cost increase resulting from the tax on to the consumers of the product
c. reduces the profits earned by sellers since they must write the check to pay the tax
d. makes the demand more inelastic
e. makes the demand more elastic
B
You might also like to view...
When the market demand curve is relatively inelastic
A) it is unrealistic for a cartel to form because profits will be lower. B) penalties for forming an illegal cartel will be relatively low. C) the lower the price the cartel sets, the greater the benefits to the cartel. D) the higher the price the cartel sets, the greater the benefits to the cartel.
Government growth has been caused by
A. citizens who want larger government. B. lots of public lands available in the West. C. increases in privatization. D. inflation.