If the demand for a product is perfectly inelastic and supply is upsloping, a $1 excise tax per unit on suppliers will

A) raise price by $1.
B) not raise price at all.
C) raise price by more than $1.
D) raise price by less than $1.

Question

shasha ruslan · Accepted Answer

Final Answer : A, Explanation :  When demand is perfectly inelastic, consumers are willing to pay any price for the product. Therefore, suppliers can pass the entire $1 excise tax onto consumers, raising the price by $1.

If the demand for a product is perfectly inelastic and supply is upsloping, a $1 excise tax per unit on suppliers will

A) raise price by $1.
B) not raise price at all.
C) raise price by more than $1.
D) raise price by less than $1.

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Learning Objectives

Learning Objectives

Related questions

If the demand for a product is perfectly inelastic and supply is upsloping, a $1 excise tax per unit on suppliers willA) raise price by $1.B) not raise price at all.C) raise price by more than $1.D) raise price by less than $1.

Definitions

Learning Objectives

Learning Objectives

Related questions

If the demand for a product is perfectly inelastic and supply is upsloping, a $1 excise tax per unit on suppliers will

A) raise price by $1.
B) not raise price at all.
C) raise price by more than $1.
D) raise price by less than $1.