If the Supply of a Good Is Perfectly Elastic,then a Tax

question 50

Multiple Choice

If the supply of a good is perfectly elastic,then a tax on the good will be paid

• A)completely by the buyers.
• B)completely by the sellers.
• C)equally by the buyers and sellers.
• D)mostly but not completely by the buyers.
• E)mostly but not completely by the sellers.

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Definitions:

Inflation Adjustment

A modification made to the value of money to account for changes in purchasing power due to inflation.

Stock Exchanges

Marketplaces where securities, such as stocks and bonds, are bought and sold.

Pure Interest Rate

The theoretical rate of return of an investment with no risk of financial loss, not influenced by demand for investments or market risks.

Earning Power

A company's ability to generate profit from its operations over time and maintain financial stability.