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Jominova Felisilda
on Oct 25, 2024

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If the government levies an excise tax in a market whose supply curve is perfectly inelastic,the burden of the tax will fall completely on the _____,and the deadweight loss will equal _____.

A) consumers;zero
B) producers;zero
C) consumers;the tax revenue
D) producers;the tax revenue

Perfectly Inelastic

A market condition where demand does not change regardless of changes in price.

Deadweight Loss

A loss of economic efficiency that can occur when the equilibrium for a good or a service is not achieved or is not achievable.

Excise Tax

A tax imposed on specific goods, services, or transactions, often included in the price of the product, like alcohol, tobacco, and gasoline.

  • Learn about the distribution of tax loads between consumers and producers.
  • Acquire insights into the notion of tax incidence and how it is shaped by the degree of elasticity in demand and supply.
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Becca Boo Hula HoopsOct 27, 2024
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