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:

Facial Expressions

The movements and expressions made by the face that communicate emotional states or reactions.

Sex Customs

Traditional behaviors related to sexual relationships and practices within a particular culture or society.

Alcoholic Beverages

Drinks containing ethanol, commonly known as alcohol, produced by the fermentation of grains, fruits, or other sources of sugar.

Proximity

The physical closeness or distance of objects or individuals, which can influence various psychological and sociological phenomena, including attraction and relationship formation.