If the Price of a Good Is Not Affected by a Tax

question 120

Multiple Choice

If the price of a good is not affected by a tax, then

• A)supply is perfectly elastic.
• B)demand is perfectly elastic.
• C)the elasticity of supply is greater than elasticity of demand.
• D)demand is unit elastic.
• E)supply is unit elastic.

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Definitions:

Relationship

A connection or association between two or more elements, typically emphasizing how they affect each other.

Rate of Inflation

The percentage increase in the general level of prices for goods and services in an economy over a period of time.

Unemployment Rate

The percentage of the labor force that is jobless and actively looking for employment.

Predict

The act of forecasting future values or outcomes based on historical data or trends.