Question
help me answer and understand please: Taxes on particular goods discourage their consumption. Economists say that such taxes distort consumer demands. In terms of the
help me answer and understand please:
Taxes on particular goods discourage their consumption. Economists say that such taxes "distort consumer demands." In terms of the elasticity of demand (or elasticity of supply) for the commodities in question, what sort of goods (in terms of their elasticities) would you choose to tax to achieve the following objectives? Give an example of the type of good/product for each AND explain whether you are referring to the demand curve or the supply curve. a. Collect a large amount of tax revenue
b. Distort demand as little as possible
c. Discourage consumption of harmful commodities
d. Discourage production of polluting commodities
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