Since the supply of undeveloped land is relatively inelastic, a tax on undeveloped land would generate

Question

Quizplus · Accepted Answer

Since the supply of undeveloped land is inelastic, a tax on it would not affect the amount of land available for rent or development. Therefore, the burden of the tax would likely fall on the landlord, who would have to bear the cost of the tax without being able to pass it on to tenants in the form of higher rent prices. Since the deadweight loss would be small, Option D is the best choice.

Since the Supply of Undeveloped Land Is Relatively Inelastic, a Tax