Historically salt has been one of the most commonly taxed items.Which of the following do you think best explains this fact?
A)Since salt is a necessity, levying a tax on it imposed a hardship on no one
B)The burden of the tax will be shared by everyone since everyone uses salt
C)Because salt is used more by those with higher incomes, a tax will decrease their consumption
D)The demand for salt is inelastic
E)The demand for salt is elastic

Question

Quizplus · Accepted Answer

The demand for salt is inelastic, meaning that a change in price will not significantly affect the quantity demanded. This makes it an ideal item to tax, as the government can raise revenue without reducing consumption.

Historically Salt Has Been One of the Most Commonly Taxed