If the Demand for a Good Is Highly Inelastic, a Tax

question 182

Multiple Choice

If the demand for a good is highly inelastic, a tax on the good

• A) places the burden of the tax equally on buyers and sellers
• B) permits sellers to pass most of the cost increase resulting from the tax on to the consumers of the product
• C) reduces the profits earned by sellers since they must write the check to pay the tax
• D) makes the demand more inelastic
• E) makes the demand more elastic

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Definitions:

Sensorimotor Period

The first stage in Jean Piaget's theory of cognitive development, occurring from birth to about age 2, where infants learn through sensory experiences and manipulating objects.

Decentering

A cognitive ability to consider multiple aspects of a situation or adopt another person's perspective, vital in developing empathy and solving problems effectively.

Preoperational

A developmental stage in Jean Piaget's theory, characterized by symbolic thought and egocentrism, typically from ages 2 to 7.

Concrete Operational

A stage in Piaget's theory of cognitive development where children aged 7-12 years develop logical thinking but still struggle with abstract concepts.