Suppose the market for grass seed can be expressed as:
Demand: Q_D = 100 - 2p
Supply: Q_S = 3p
Price elasticity of supply is constant at one.If the demand curve is changed to Q = 10 - .2p,price elasticity of demand at any given price is the same as before.Yet the incidence of a tax falling on consumers will be higher.Why?

Question

Quizplus · Accepted Answer

The Answer of Suppose the market for grass seed can be expressed as: Demand: Q_D = 100 - 2p Supply: Q_S = 3p Price elasticity of supply is constant at one.If the demand curve is changed to Q = 10 - .2p,price elasticity of demand at any given price is the same as before.Yet the incidence of a tax falling on consumers will be higher.Why?

Suppose the Market for Grass Seed Can Be Expressed As