Last Updated 12 May 2020
The price elasticities of supply and demand affect?
a. both the size of the deadweight loss from a tax and the tax incidence.
b. the size of the deadweight loss from a tax but not the tax incidence.
c. the tax incidence but not the size of the deadweight loss from a tax.
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The price elasticities of supply and demand affect?
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Answer: Affects both the size of the deadweight loss from a tax and the tax incidence.
If demand is more elastic then tax incidence (burden) of tax will be more on consumers and if supply is more elastic then producers will bear the brunt of the tax
Also more the elasticity of demand and supply, more is the dead weight loss from a tax
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The price elasticities of supply and demand affect?. (2018, Sep 13). Retrieved from https://phdessay.com/the-price-elasticities-of-supply-and-demand-affect/