G Google xindTap-Cengage Learning x+ c https://ng.cengagecon /static/mb/ui/evo/i

Question

G Google xindTap-Cengage Learning x+ c https://ng.cengagecon /static/mb/ui/evo/index.htmi?elSBN-97813370966078id 3760494878snapshotid-+ MINDTAP Fram Cengage Homework 5 (Ch 08) Deadweight Loss 35 30 25 20 15 10 0 50 100 150 200 250 300 350 400 450 500 550 600 QUANTITY (Bottles) Complete the following table with the tax revenue collected and deadweight loss caused by each of the tax proposals. Tax Revenue Deadweight Loss (Dollars) If the Government Taxes... Jeans at $30 per pair Allergy medication at $30 per bottle 6,000 Suppose the government wants to tax the good that will generate more tax revenue at a lower welfare cost. In this case, it shoul because, all else held constant, taxing a good with a relatively elastic demand generates l and smaller deadweight loss. Grade It Now Con 0 Type here to search

Explanation / Answer

If demand is inelastic then a large change in price results in small change in demand.If government taxes goods that have inelastic demand,then it will be able to generate more tax revenue (because quantity won't fall much) and the DEAL will be less.

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