The greater the price elasticity of supply and demand, the more the market volume decreases when excise tax is imposed. Therefore, the net economic loss is large, and the one with less price elasticity among consumers and suppliers is relatively pay less tax

The greater the price elasticity of supply and demand, the more the market volume decreases when excise tax is imposed. Therefore, the net economic loss is large, and the one with less price elasticity among consumers and suppliers is relatively pay less tax

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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