Who gets most of the burden of the tax when demand condition is D1 and what is the tax burden? * Given the above answers, what can be inferred about the elasticity of demand? * Who gets most of the burden of the tax when demand condition is D2 and what is the tax burden? *
Who gets most of the burden of the tax when demand condition is D1 and what is the tax burden? * Given the above answers, what can be inferred about the elasticity of demand? * Who gets most of the burden of the tax when demand condition is D2 and what is the tax burden? *
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
Use the figure provided below to answer the succeeding questions. .
- Who gets most of the burden of the tax when demand condition is D1 and what is the tax burden? *
- Given the above answers, what can be inferred about the elasticity of demand? *
- Who gets most of the burden of the tax when demand condition is D2 and what is the tax burden? *
- Given the above answers, what can be inferred about the elasticity of demand? *
- What is the price elasticity of supply (in absolute value) under D1 condition? *
- What is the price elasticity of demand (in absolute value) under D1 condition? *
- Under D1 condition, what is the change in price after the sales tax has been imposed? *
- Under D2 condition, what is the change in price after the specific tax has been imposed? *
- What tax revenue is expected by the government if the demand for cigarettes is D1? *
- What tax revenue is expected by the government if the demand for cigarettes is D2? *
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