"For a given supply curve, the excess burden of a tax will be greater when the demand for a product is less elastic than when the demand is more elastic." This statement is
A)correct.
B)incorrect because the incidence of the tax, not the burden of the tax, is affected by the elasticity of demand.
C)incorrect. When demand is less elastic, the burden of the tax is smaller than when the demand is more elastic.
D)incorrect. The statement confuses demand with quantity demanded.

Question

Quizplus · Accepted Answer

The Answer of "For a given supply curve, the excess burden of a tax will be greater when the demand for a product is less elastic than when the demand is more elastic." This statement is
A)correct.
B)incorrect because the incidence of the tax, not the burden of the tax, is affected by the elasticity of demand.
C)incorrect. When demand is less elastic, the burden of the tax is smaller than when the demand is more elastic.
D)incorrect. The statement confuses demand with quantity demanded.

"For a Given Supply Curve, the Excess Burden of a Tax