Sin taxes are most effective when imposed on goods for which:
A. both demand and supply are elastic.
B. demand is elastic and supply is inelastic.
C. both demand and supply are inelastic.
D. demand is inelastic and supply is elastic.
Answer: A
You might also like to view...
Without any change in the demand for labor, how will shifts in the supply of labor affect equilibrium wage and employment?
What will be an ideal response?
Autonomous consumption is 700 and the marginal propensity to consume is 0.6. Calculate the average propensity to save when disposable income is (a) 10,000, (b) 12,000, and (c) 15,000
What will be an ideal response?
When quantities of two goods belong to the same indifference curve, which of the following is true?
a. The combinations of the two goods along the indifference curve yield the same total utility. b. Prices of the two goods are equal. c. Marginal utilities of both goods are equal. d. The total utility of all combinations above the curve equal zero.
If a new insect invasion devastates crops all across the United States, which of the following would most likely occur in the short run?
a. Unit costs would decrease and the economy would move upward along the aggregate supply curve. b. Unit costs would increase and the aggregate supply curve would shift downward. c. Unit costs would increase and there would be movement along the aggregate supply curve. d. Unit costs would decrease and the aggregate supply curve would shift upward. e. Unit costs would increase and the aggregate supply curve would shift upward.