Suppose That Policymakers Are Considering Placing a Tax on Either

question 7

Multiple Choice

Suppose that policymakers are considering placing a tax on either of two markets.In Market A,the tax will have a significant effect on the price consumers pay,but it will not affect equilibrium quantity very much.In Market B,the same tax will have only a small effect on the price consumers pay,but it will have a large effect on the equilibrium quantity.Other factors are held constant.In which market will the tax have a larger deadweight loss?

• A)Market A
• B)Market B
• C)The deadweight loss will be the same in both markets.
• D)There is not enough information to answer the question.

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Definitions:

Nutritional Consumption

The intake and use of nutrients by the body from food and supplements for health and growth.

Socioeconomic Status

An indicator that determines a person's or household's social and economic status compared to others through their earnings, level of education, and job type.

Caloric Requirements

The amount of calories a person needs to consume daily to maintain their health and energy levels, varying by age, sex, weight, and activity level.

Age Range

The span of ages between the youngest and oldest individuals within a group or population.