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Suppose That the Demand for Digital Pianos Is Price Inelastic

Question 169

Multiple Choice
Suppose that the demand for digital pianos is price inelastic and the supply of digital pianos is price elastic.By what amount will a tax of $1.00 per frame levied on buyers of picture frames increase the equilibrium price paid by buyers of digital pianos

Suppose that the demand for digital pianos is price inelastic and the supply of digital pianos is price elastic.By what amount will a tax of $1.00 per frame levied on buyers of picture frames increase the equilibrium price paid by buyers of digital pianos


A) by less than $0.50
B) by more than $0.50 but less than $1.00
C) by $1.00
D) by more than $1.00

Correct Answer:

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