Explain Why the Elasticities of Supply and Demand Determine Who

question 127

Essay

Explain why the elasticities of supply and demand determine who bears more of the burden of a tax,consumers or producers.

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Definitions:

Holding Period

The duration for which an investment is held by an investor before being sold.

Risky Assets

Assets with a high degree of uncertainty regarding their returns, with the potential for both high losses and high returns.

Treasury Bills

Short-term government securities issued at a discount from the face value and mature at par.

Historical Returns

The past financial performance of an investment, often presented as an average annual return rate over a specific time period.