To avoid an increase in the local property tax, Sullivan County, New York, proposed a 2 percent hotel tax, which presumably would be passed on to tourists. The hotel industry argued that the tax would hurt hotel business. They are really arguing that
A. tourist and convention demand is inelastic, so hotel bookings will decline.
B. tourist and convention demand is very elastic, so hotel bookings will decline.
C. they would prefer a property tax increase instead.
D. it is unfair to tax people who do not live in the area.
Answer: B
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