The Portion of a Sales Tax Increase Paid by the Consumers

question 12

Multiple Choice

The portion of a sales tax increase paid by the consumers of a good is smaller the

• A) steeper the demand curve.
• B) greater the upward shift of the supply curve.
• C) less sensitive the quantity supplied is to changes in price.
• D) smaller the downward shift of the supply curve.
• E) less sensitive the quantity demanded is to changes in price.

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Definitions:

BRIC Countries

An acronym for Brazil, Russia, India, and China, which are four major emerging national economies known for their significant growth and industrial potential.

Economic Growth

An increase in the production of goods and services in an economy over a period of time, typically measured by Gross Domestic Product (GDP).

Greenfield Investment

Direct investment in new facilities or the expansion of an existing facility in a foreign country, starting from scratch.

Financial Risk

Risk associated with a monetary outlay; includes the initial cost of the purchase, as well as the costs of using the item or service.