When a Good with a Perfectly Inelastic Demand Is Taxed,the

question 148

Multiple Choice

When a good with a perfectly inelastic demand is taxed,the incidence of the tax is borne

• A) entirely by producers.
• B) by consumers and producers equally.
• C) entirely by consumers.
• D) mostly by consumers.
• E) mostly by producers.

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Definitions:

Birth Rate

The number of live births per thousand of the population per year.

Domestic Investment

The total spending on capital within a country, including spending on new buildings, machinery, and inventory changes.

Real GDP

A measure of the value of all goods and services produced by an economy adjusted for price changes or inflation.

Foreign Investment

The investment of capital by individuals, corporations, or governments from one country into business interests within another country.