Assume that both the supply of and the demand for a good are relatively price elastic. The imposition of a per-unit excise tax on the sale of the good would cause the equilibrium price and quantity to change in which of the following ways?

Question

Physics

Eduardo Shepherd

9 February, 01:08

Assume that both the supply of and the demand for a good are relatively price elastic. The imposition of a per-unit excise tax on the sale of the good would cause the equilibrium price and quantity to change in which of the following ways?

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Answers (2)

Know the Answer?

Simone Holden · Answer 1

is the demand goes up they will make more

Dolly · Answer 2

Answer:P:Increase Q:Decrease

Explanation: The price of the product will increase as the imposed per-unit excise tax on the sale of the good. This is true for both Perfectly-elastic and relatively elastic products.

The quantity demanded of the product will decrease as the price of the product increases, this his is true for both Perfectly-elastic and relatively elastic products. It will follow the law of Demand and Supply.