Suppose That the Supply of Insulin Is Perfectly Elastic and the Demand

question 183

Multiple Choice

Suppose that the supply of insulin is perfectly elastic and the demand for insulin perfectly inelastic. Then the result of an excise tax would be

• A)a significant increase in government revenue and a significant decrease in the quantity consumed.
• B)a significant decrease in the quantity consumed with no change in government revenue.
• C)a significant increase in government revenue and no change in the quantity consumed.
• D)no increase in government revenue and no change in the quantity consumed.