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Business
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| Number of pages / Number of words: |
4 / 854 |
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The more inelastic the demand, the greater the burden shifted to the consumer (consider the tax on cigarettes). The more elastic the demand, the greater the burden borne by the producer (consider a tax on milk in glass milk bottles but not on milk in paper cartons, each a close substitute for the other in the eyes of most consumers)†(Combs, 2007)...
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The more elastic the demand, the greater the burden borne by the producer (consider a tax on milk in glass milk bottles but not on milk in paper cartons, each a close substitute for the other in the eyes of most consumers)†(Combs, 2007). After figuring out the supply and demand, ramifications will the tax effect have on the equilibrium price and quantity...
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