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Suppose a $1 Tax Is Placed on a Good

Question 58

Multiple Choice

Suppose a $1 tax is placed on a good. The more elastic the supply of the good, the


A) smaller the decrease in the quantity sold.
B) more of the tax will be paid by the sellers.
C) larger the increase in the after- tax price.
D) less of the tax will be paid by the buyers.

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