Suppose the Demand Curve for a Good Is Downward Sloping

question 74

Multiple Choice

Suppose the demand curve for a good is downward sloping and the supply curve is upward sloping.At the market equilibrium,if demand is more elastic than supply in absolute value,a $1 specific tax will

• A) raise the price to consumers by 50 cents.
• B) raise the price to consumers by less than 50 cents.
• C) raise the price to consumers by more than 50 cents.
• D) raise the price to consumers by $1.

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Definitions:

Independent Parts

Components within a system that operate or function separately from one another.

Point Of View

A specific attitude or way of considering a matter, influenced by one's personal experience and beliefs.

Pluralistic Society

A society that is characterized by a diversity of cultural, ethnic, religious, and ideological perspectives, encouraging coexistence and mutual respect among different groups.

Ethnic Society

A group of people who share common cultural, linguistic, or ancestral ties.