-The Demand for Apple Pies Is Perfectly Elastic

question 100

Multiple Choice

-The demand for apple pies is perfectly elastic.If the government taxes apple pies at $1 a pie,then ________.

• A) the seller pays the entire tax
• B) the buyer pays the entire tax
• C) the seller and the buyer split the tax evenly
• D) the seller and the buyer split the tax but the seller pays more
• E) who pays the tax depends on whether the government imposes the tax on pie buyers or on pie sellers

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Definitions:

Rescind

To revoke, cancel, or repeal a contract, agreement, or law, making it as though it never existed.

Tenant

An individual or entity that occupies property or land rented from a landlord or owner.

Overcharges

The act of charging someone more than the fair or agreed upon price for goods or services.

Specific Performance

A legal remedy wherein a court orders a party to fulfill their obligations under a contract, rather than paying damages for failing to do so.