Suppose supply is P= 4 + (1/4)Qs and demand is P= 58 ―(1/2)Qs. At a glance, can you tell whether supply or demand is more price elastic in equilibrium? How? What does this tell you about who will pay more of a tax on this product? (DO NOT DO ANY MATH)
Suppose supply is P= 4 + (1/4)Qs and demand is P= 58 ―(1/2)Qs. At a glance, can you tell whether supply or demand is more price elastic in equilibrium? How? What does this tell you about who will pay more of a tax on this product? (DO NOT DO ANY MATH)
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter5: Elasticity
Section: Chapter Questions
Problem 17RQ: If supply is elastic, will shifts in demand have a larger effect on equilibrium quantity or on...
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Suppose supply is P= 4 + (1/4)Qs and demand is P= 58 ―(1/2)Qs. At a glance, can you tell whether supply or demand is more price elastic in equilibrium? How? What does this tell you about who will pay more of a tax on this product? (DO NOT DO ANY MATH)
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