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If the Supply Curve Is More Price Elastic Than the Demand

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Essay

If the supply curve is more price elastic than the demand curve, will the buyers or the sellers bear a greater burden of a tax? Draw a diagram to illustrate your answer.


Definitions:

Weighted-Average Number

A calculation that takes into account the varying degrees of importance of the numbers in a data set, used to find a kind of average that considers weight.

Preferred Stock

A type of stock that grants holders priority for dividend payments and, in some cases, priority in asset liquidation over common stockholders.

Stockholders' Equity

The portion of the balance sheet that represents the capital received from investors in exchange for stock (paid-in capital), donated capital and retained earnings.

Cash Dividend

A payment made by a company out of its earnings to shareholders, usually in the form of cash.

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