The Greater the Elasticity of Supply of and Demand for a Good

question 151

Multiple Choice

The greater the elasticity of supply of and demand for a good, the

• A) smaller will be the efficiency loss of an excise tax on the good.
• B) more likely the good will be a public good rather than a private good.
• C) larger will be the efficiency loss of an excise tax on the good.
• D) larger will be the proportion of an excise tax on the good that will be shifted forward to consumers.

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