A government seeking to raise revenue would be most likely to tax a good with a
A) high income elasticity of demand.
B) low cross-price demand elasticity.
C) high price elasticity of demand.
D) low price elasticity of demand.

Question

Quizplus · Accepted Answer

A good with low price elasticity of demand means that consumers will continue to buy it even if the price increases, making it an effective target for taxation to raise revenue.

A Government Seeking to Raise Revenue Would Be Most Likely