Suppose the Demand Curve for a Product Is Horizontal and the Supply

question 80

Multiple Choice

Suppose the demand curve for a product is horizontal and the supply curve is upward sloping.If a per-unit tax is imposed in the market for this product,

• A)sellers bear the entire burden of the tax.
• B)the tax burden will be shared among the government, buyers, and sellers.
• C)buyers bear the entire burden of the tax.
• D)the tax burden will be shared by buyers and sellers.

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Definitions:

Standard Of Living

The degree of prosperity, convenience, and access to material possessions and basic needs experienced by an individual, community, or society.

Real GDP

The measure of the value of economic output adjusted for price changes (inflation or deflation), reflecting the real volume of production.

Prosperity

A state of economic flourishing where there is wealth and success within a society or region.

Rapid Economic Growth

A period characterized by a significantly faster than average increase in the economy's output, often marked by increased production, investment, and consumer spending.