A Tax Targeted to Reduce Consumption of a Good by a Specific

question 36

Multiple Choice

A tax targeted to reduce consumption of a good by a specific quantity will raise the most revenue when:

• A) both supply and demand are inelastic.
• B) supply is inelastic and demand is elastic.
• C) supply is elastic and demand is inelastic.
• D) both supply and demand are elastic.

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Definitions:

G Factor

A theory suggesting a general intelligence factor that underlies all intelligent activity.

Genetic Contribution

The influence of genes inherited from parents on the physical and behavioral traits of an individual.

Divergent Thinking

Divergent thinking is a thought process or method used to generate creative ideas by exploring many possible solutions.

Flynn Effect

A term describing the observed substantial and long-term increase in both fluid and crystallized intelligence test scores measured in many parts of the world over the 20th century.