If the Demand for a Product Is Perfectly Inelastic and the Supply

question 86

Multiple Choice

If the demand for a product is perfectly inelastic and the supply curve is upsloping,the imposition of a $1 excise tax per unit of output will:

• A)raise the price as seen by buyers by $1
• B)raise the price as seen by buyers by more than $1
• C)raise the price as seen by buyers by less than $1
• D)lower the price by $1
• E)lower the price by more than $1

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Definitions:

Blind Spot

The point at which the optic nerve leaves the eye, creating a “blind” spot because no receptor cells are located there.

Accommodation of the lens

The method in which the lens of the eye adjusts its shape to concentrate on objects at various distances onto the retina.

Dilation of the Pupils

The expansion of the pupils in response to low light conditions or certain emotional states.

Ganglion Cells

Type of neurons located in the retina that receive visual information from photoreceptors via intermediate bipolar cells and transmit it to the brain.