The Demand for a Good and the Supply of a Good

question 74

Multiple Choice

The demand for a good and the supply of a good are each neither perfectly elastic nor perfectly inelastic.If a sales tax on sellers of the good is imposed,the tax is paid by

• A)the buyers only.
• B)both the buyers and the sellers.
• C)the sellers only.
• D)the buyers only if demand for the good increases.
• E)the suppliers only if the supply of the good increases.

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Definitions:

Money Supply

The total amount of monetary assets available in an economy at a specific time.

Price Level

A composite measure reflecting the prices of all goods and services in the economy relative to prices in a base year.

Consumer Spending

The total expenditure by households on goods and services within a certain period of time, a primary engine of economic activity.

Flow Variable

A flow variable is an economic measure that represents a movement or quantity that is reported per unit of time, such as income per year or spending per month.