Under What Supply and Demand Conditions Would an Excise Tax

question 167

Essay

Under what supply and demand conditions would an excise tax create a large incidence of the tax on suppliers and a small incidence of the tax on consumers? Explain how this works.

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Definitions:

Limitation of Damages

Legal provisions or contract terms that restrict the amount of compensation for breach of contract or injury.

Contractual Provision

A specific clause or term within a contract that outlines duties, rights, or obligations of the parties involved.

Liquidated Damages

A pre-determined amount of money agreed upon in a contract that is payable as damages for breach of contract.

Reasonable

Pertains to actions or decisions that are sensible, fair, and logical based on the circumstances presented.