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Stephany Flores
on Oct 25, 2024

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Given any downward-sloping demand curve for a good,the more inelastic the supply curve,the _____ equilibrium output will fall and the _____ will be the deadweight loss when the government imposes an excise tax.

A) more;smaller
B) more;larger
C) less;smaller
D) less;larger

Deadweight Loss

The reduction in economic productivity resulting from a failure to reach or the impossibility of reaching the market equilibrium for a particular product or service.

Excise Tax

A tax on specific goods or services, often with the goal of discouraging their use or generating revenue.

Supply Curve

A graphical representation of the relationship between the price of a good and the amount of it suppliers are willing to offer for sale, holding other factors constant.

  • Achieve understanding of how elasticity impacts deadweight loss.
  • Recognize merchandise that faces the lowest and highest deadweight losses as a result of taxation.
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18TUCS225 SIVA ILAKKIYA P.Oct 30, 2024
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