If the Price of a Good Is Less Than a Buyer's

question 54

Multiple Choice

If the price of a good is less than a buyer's willingness to pay, the buyer will _____ the good because the opportunity cost of buying the good is _____ than the benefit received from consuming the good.

• A) purchase; less
• B) purchase; more
• C) not purchase; less
• D) not purchase; more.

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Definitions:

Tax Revenue

The income that is gained by governments through taxation.

Inelastic Demand

A situation where the demand for a product does not significantly change with a change in its price.

Price Inelastic

Refers to a situation where the quantity demanded or supplied of a good or service changes by a smaller percentage than changes in price.

Alcohol Tax

A tax imposed on the sale of alcoholic beverages, often used as a means to discourage excessive drinking and to generate government revenue.