Suppose the Price Elasticity of Demand Is Relatively Elastic and the Price

question 255

Multiple Choice

Suppose the price elasticity of demand is relatively elastic and the price elasticity of supply is relatively inelastic in a specific market.If an excise tax is imposed on this good,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:

Radius

The distance from the center of a circle to any point on its circumference, or a straight line extending from the center to the circumference.

Distance

The measurement of space between two points, which can be quantified in units like meters, miles, or light-years, depending on the context.

Specific Gravity

A measurement of the density of a substance compared to water. Specific gravity tests are performed on battery acid and coolant.

Model Year

The year assigned to a vehicle by its manufacturer indicating the marketing period it was made for, which may not necessarily coincide with the year it was manufactured.