Asked by
Kelliann Drury
on Dec 17, 2024
Verified
The greater the elasticity of demand, the smaller the deadweight loss of a tax.
Elasticity of Demand
A measure of how much the quantity demanded of a good responds to a change in its price, income levels, or other factors.
Deadweight Loss
The loss of economic efficiency that can occur when the free market equilibrium for a good or a service is not achieved.
- Comprehend the association between the elasticity of both demand and supply and the resulting deadweight loss from taxation.
Verified Answer
GS
Learning Objectives
- Comprehend the association between the elasticity of both demand and supply and the resulting deadweight loss from taxation.