If the government wanted a tax to raise a great deal of revenue but not burden producers much, it would want to tax an industry with

Question

If the government wanted a tax to raise a great deal of revenue but not burden producers much, it would want to tax an industry with​

Quizplus · Accepted Answer

If the government wants to raise a great deal of revenue without burdening producers too much, it should tax an industry with an elastic supply and inelastic demand. This way, producers will not be able to pass on the entire burden of the tax to consumers, resulting in a lower increase in prices, and thus less burden on consumers. At the same time, because the supply is elastic, the tax will generate a large amount of revenue for the government as producers are still willing to produce and sell their goods even with the tax.

If the Government Wanted a Tax to Raise a Great