Figure 58 Shows a Horizontal Line

question 100

Multiple Choice

Figure 5.8 shows a horizontal line. The curve shown in the figure below could represent a:​ Figure 5.8

• A)perfectly elastic demand or supply curve.
• B)perfectly inelastic supply curve or a perfectly elastic demand curve.
• C)perfectly elastic supply curve or a perfectly inelastic demand curve.
• D)perfectly inelastic supply or demand curve.
• E)perfectly inelastic supply curve or a demand that is unit elastic.

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Definitions:

Deadweight Loss

The drop in economic efficiency due to the inability or failure of a good or service to reach its equilibrium state.

Government Revenue

The total income received by the government from taxes, fees, and non-tax sources like government-owned enterprises and foreign aid.

Tax Rate

The share of an individual's or corporation's income that is subject to taxation.

Deadweight Loss

A loss in total economic welfare that occurs when the free market equilibrium for a good or a service is not achieved, typically due to taxes, subsidies, or market controls.