Asked by
erika fernandez
on Nov 26, 2024Verified
Given supply, the more inelastic the demand for a product, the larger the portion of an excise tax that is shifted to consumers.
Inelastic Demand
A scenario in which the need for a product remains largely unaffected despite variations in its price.
Excise Tax
A tax levied on specific goods, services, and activities, such as tobacco, alcohol, and gambling, often used to discourage their use and generate government revenue.
- Acquire knowledge on the role of demand and supply elasticity in determining the tax load.
Verified Answer
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Learning Objectives
- Acquire knowledge on the role of demand and supply elasticity in determining the tax load.