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The Most Important Difference Between Unit Excise Taxes and Ad

Question 12

Multiple Choice

The most important difference between unit excise taxes and ad valorem excise taxes is _____.


A) the unit tax will change in response to a change in the price of the taxed good,while the ad valorem tax will not
B) the unit tax will not change in response to a change in the price of the taxed good,while the ad valorem tax will
C) the unit tax increases in response to a change in the price of the taxed good,while the ad valorem tax will decline
D) the unit tax declines in response to a change in the price of the taxed good,while the ad valorem tax will increase

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