Suppose Price Elasticity of Demand Is Relatively Inelastic for Good

question 145

Multiple Choice

Suppose price elasticity of demand is relatively inelastic for good X.If the price elasticity of supply for good X is elastic and an excise tax is imposed on good X,who will bear the greater burden of the tax?

• A)consumers
• B)producers
• C)both consumers and producers equally
• D)government

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Definitions:

Authority

The power or right to give orders, make decisions, and enforce obedience.

Standing to Sue

The legal right to initiate a lawsuit, based on having a sufficient connection to and harm from the law or action challenged to support that party's participation in the case.

Sufficient Stake

The extent of interest or concern one must have in a matter to justify their involvement or legal standing in a case.

Justify

To justify means to provide a logical, moral, or legal reason or explanation that supports an action, decision, or concept.