How Would the Elimination of a Sales Tax Affect the Market

question 119

Multiple Choice

How would the elimination of a sales tax affect the market for a product that had been subject to the tax?

• A)The demand for the product would rise and the equilibrium price would fall by the amount of the tax.
• B)The equilibrium price for the product would fall by less than the amount of the tax.
• C)The reduction in government revenue from the tax would be made up by an increase in property taxes.
• D)The supply of the product would become more elastic.

---

Definitions:

Situational Model

A conceptual framework suggesting that the effectiveness of leadership styles varies depending on the context and the level of followers' readiness.

Level Of Development

The stage or phase in the growth or advancement of an entity, which can refer to individuals, organizations, or communities.

Delegating Behaviors

The practice of assigning responsibility and authority to others to complete tasks or make decisions, while maintaining accountability for the outcomes.

Follower Development Level

The extent to which followers have the competence and commitment necessary to complete tasks independently.