Placing an excise tax on gasoline would better promote conservation if the demand for gasoline is relatively elastic, rather than relatively inelastic.

Name: Placing an excise tax on gasoline would better promote conservation if the demand for gasoline is relatively elastic, rather than relatively inelastic.
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Question

Quizplus · Accepted Answer

When demand is elastic, consumers are more responsive to price changes, so an excise tax would lead to a larger reduction in quantity demanded, promoting conservation.

Placing an Excise Tax on Gasoline Would Better Promote Conservation