On which of the following goods would you expect the revenue generated from the imposition of a tax to be the greatest?
A)A prescription drug ordered by your doctor
B)Bayer aspirin
C)An over-the-counter cough medicine
D)A specific brand of vitamin pills
E)Rubbing alcohol

Question

Quizplus · Accepted Answer

Prescription drugs typically have inelastic demand because they are necessary for health, meaning consumers will continue to purchase them even if prices rise due to a tax. This inelasticity leads to higher revenue from taxes.

On Which of the Following Goods Would You Expect the Revenue