Suppose the Demand for Picture Frames Is Inelastic and the Supply

question 185

Multiple Choice

Suppose the demand for picture frames is inelastic and the supply of picture frames is elastic.A tax of $1 per frame levied on buyers of picture frames will increase the equilibrium price paid by buyers of picture frames by

• A)$1.
• B)more than $0.50 but less than $1.00.
• C)a positive amount but less than $0.50.
• D)It is impossible to say without more information.

---

Definitions:

Owner

An individual or entity that has legal title to, or vested interest in, property or assets.

Easement Appurtenant

A right for the benefit of one piece of land (dominant estate) that allows access or use of a neighboring land (servient estate).

New Owner

The individual or entity that acquires ownership or property rights in something, such as real estate or a company, often through purchase or transfer.

Land

The part of the earth's surface that is not covered by water, including any buildings, crops, or natural resources upon it, which can be owned or used.