A Convenience Store Owner in Philadelphia Was Worried That the Implementation

question 278

Multiple Choice

A convenience store owner in Philadelphia was worried that the implementation of the 1.5 cents per ounce tax on sweetened beverages would cause the quantity demanded to fall by so much that he would be in a worse situation if he passed the tax on to customers by raising prices than if he did not raise prices.If raising the price of sweetened beverages would cause the owner to receive less total revenue from the sale of sweetened beverages, the demand for sweetened beverages is

• A)elastic.
• B)inelastic.
• C)unit elastic.
• D)perfectly inelastic.

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