In a Market Where Supply and Demand Are Both Somewhat

question 69

Multiple Choice

In a market where supply and demand are both somewhat elastic,but demand is more elastic than supply,consumers will bear less of the burden of a tax because

• A) consumers have a greater ability to change their behavior in response to the tax than producers do.
• B) producers are more likely to be responsible for paying the tax out of pocket.
• C) both parties have equal ability to change their behavior in response to the tax.
• D) consumers will experience lower prices as a result of the tax.
• E) producers have a greater ability to change their behavior in response to the tax than consumers do.

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Definitions:

Ponzo Illusion

A visual illusion where two horizontal lines of identical length appear different in length because of converging parallel lines in the background.

Necker Effect

An optical illusion related to the perception of a two-dimensional drawing of a cube, which can spontaneously appear to switch orientation.

McCullough Effect

A phenomenon where prolonged exposure to colored gratings causes the visual system to adapt and see complementary colors in grayscale patterns.

Perceptual Constancies

The tendency to perceive objects as unchanging, despite changes in sensory input, such as changes in illumination, angle, or distance.