Suppose Price Elasticity of Demand Is Relatively Inelastic for Good

question 145

Multiple Choice

Suppose price elasticity of demand is relatively inelastic for good X.If the price elasticity of supply for good X is elastic and an excise tax is imposed on good X,who will bear the greater burden of the tax?

• A)consumers
• B)producers
• C)both consumers and producers equally
• D)government

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Definitions:

Current Owner

The individual or entity that currently holds ownership rights over a business, property, or asset.

Customers

Individuals or entities that purchase goods or services from a business, playing a crucial role in its sustainability.

Suppliers

Entities or individuals that provide goods or services to another entity, typically a company, under agreed terms and conditions.

Sales Volume

The total number of units of a product or service sold over a specific period of time, often used to measure a company’s performance.