Economics 2281 · O Level · Price elasticity of demand (PED)

Price elasticity of demand (PED) — practice question

A government has imposed a tax on a necessity. Producers have shifted a large part of this tax onto consumers by charging higher prices. Which row is correct?

  • Atype of tax: direct; price elasticity of demand: price elastic
  • Btype of tax: direct; price elasticity of demand: price inelastic
  • Ctype of tax: indirect; price elasticity of demand: price elastic
  • Dtype of tax: indirect; price elasticity of demand: price inelastic

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