The Supply Curve for a Product Has Infinite Elasticity

question 57

Multiple Choice

The supply curve for a product has infinite elasticity. An excise tax is levied on the product. The likely effect will be to

• A) reduce the amount the producer receives for each unit sold by the amount of the tax.
• B) increase the price the consumer pays per unit by the amount of the tax.
• C) increase the price to consumers by an amount less than the tax.
• D) increase the amount received by producers by less than the tax.

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Definitions:

Prematurity

Birth occurring prior to the completion of 37 weeks gestation.

Congenital

A condition existing at the time of birth.

Birth

The process of giving life whereby an offspring is expelled from the body of its mother.

Congenital Pes Planus

A condition present at birth where the arch on the inside of the feet is flattened, allowing the entire sole to touch the ground when standing.