Assume That the Demand for Insulin Is Relatively More Inelastic

question 75

Multiple Choice

Assume that the demand for insulin is relatively more inelastic than the demand for aspirin.All else equal,a tax on aspirin:

• A)will lead to a larger deadweight loss than a tax on insulin.
• B)will have the same deadweight loss as a tax on insulin.
• C)will lead to a smaller change in quantity demanded than a tax on insulin.
• D)both A and C

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