Suppose That Government Imposes a Specific Excise Tax on Product

question 19

Multiple Choice

Suppose that government imposes a specific excise tax on product X of $2 per unit and that the price elasticity of demand for X is unitary (coefficient = 1) . If the incidence of the tax is such that consumers pay $1.8 of the tax and the producers pay $0.2, we can conclude that the

• A)supply of X is elastic.
• B)supply of X is inelastic.
• C)supply of X is unitary elastic.
• D)demand for X is elastic.

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Definitions:

U.S. Marriages

The legally or formally recognized union of two people as partners in a personal relationship, within the cultural and legal framework of the United States.

Divorce

The legal dissolution of a marriage by a court or other competent body, officially ending a marital union.

Years

Units of time that represent the period it takes for the Earth to complete one orbit around the Sun, roughly 365 days.

Transition To Parenthood

The period of adjustment and adaptation that individuals and couples go through as they become parents for the first time.