For a Given Supply Curve, How Does the Elasticity of Demand

question 168

Multiple Choice

For a given supply curve, how does the elasticity of demand affect the burden of a tax imposed on a product?

• A)The excess burden of the tax will be minimized when the demand is unit elastic.
• B)The excess burden of the tax will be greater when the elasticity of supply is greater than the elasticity of demand.
• C)The excess burden of the tax will be greater when the demand is less elastic than when it is more elastic.
• D)The excess burden of the tax will be greater when the demand is more elastic than when it is less elastic.

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Definitions:

Construct Validity

The degree to which a test or instrument accurately measures the theoretical construct it is intended to measure.

Low Construct Validity

When a test or tool does not accurately measure the theoretical concept it is intended to measure.

Operational Definition

A clear, precise description of how variables in a study will be measured or manipulated, making research findings replicable and understandable.

Construct Validity

The extent to which a test measures what it claims to be measuring, indicating the accuracy of the construct it represents.