Deadweight Loss Is Minimized When a Tax Is Levied on a Good

question 159

Multiple Choice

Deadweight loss is minimized when a tax is levied on a good for which:

• A)a price change is unlikely to cause people to change their behavior.
• B)a price change is very likely to cause people to change their behavior.
• C)a large income elasticity of demand exists.
• D)a small income elasticity of demand exists.