Figure 8-6
-Refer to Figure 8-6. Suppose the government imposes a $1 tax in each of the four markets represented by demand curves D₁, D₂, D₃, and D₄. The deadweight will be the smallest in the market represented by

Question

Figure 8-6 Figure 8-6 -Refer to Figure 8-6. Suppose the government imposes a $1 tax in each of the four markets represented by demand curves D1, D2, D3, and D4. The deadweight will be the smallest in the market represented by A) D1. B) D2. C) D3. D) D4.

Figure 8-6 -Refer to Figure 8-6. Suppose the government imposes a $1 tax in each of the four markets represented by demand curves D<sub>1</sub>, D<sub>2</sub>, D<sub>3</sub>, and D<sub>4</sub>. The deadweight will be the smallest in the market represented by A) D<sub>1</sub>. B) D<sub>2</sub>. C) D<sub>3</sub>. D) D<sub>4</sub>.

-Refer to Figure 8-6. Suppose the government imposes a $1 tax in each of the four markets represented by demand curves D₁, D₂, D₃, and D₄. The deadweight will be the smallest in the market represented by

Quizplus · Accepted Answer

The deadweight loss from a tax is smallest in the market with the most inelastic demand, which is represented by D₁.

Figure 8-6 -Refer to Figure 8-6. Suppose the Government Imposes a $1