Question
How do different elasticities of supply affect tax incidences? How do different elasticities of supply affect subsidy incidences? If a good has elastic demand and
How do different elasticities of supply affect tax incidences?
How do different elasticities of supply affect subsidy incidences?
If a good has elastic demand and inelastic supply, who pays a greater portion of the tax if an excise tax is imposed?
If a good has inelastic demand and elastic supply, who pays a greater portion of the tax if an excise tax is imposed?
If a good has elastic demand and inelastic supply, who receives a greater portion of the subsidy if a per-unit subsidy is provided by the government?
If a good has inelastic demand and elastic supply, who receives a greater portion of the subsidy if a per-unit subsidy is provided by the government?
What is the general rule of thumb for elasticities of both supply and demand to determine who pays a greater portion of the tax or receives a greater portion of the subsidy?
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