Suppose the government imposes a tax on cheese. The deadweight loss from this tax will likely be greater in the:a) first year after it is imposed than in the eighth year after it is imposed because demand and supply will be less elastic in the first year than in the eighth year. b) first year after it is imposed than in the eighth year after it is imposed because demand and supply will be more elastic in the first year than in the eighth year. c) eighth year after it is imposed than in the first year after it is imposed because demand and supply will be less elastic in the first year than in the eighth year. d) eighth year after it is imposed than in the first year after it is imposed because demand and supply will be more elastic in the first year than in the eighth year.

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04-06-2020
Business

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Suppose the government imposes a tax on cheese. The deadweight loss from this tax will likely be greater in the:a) first year after it is imposed than in the eighth year after it is imposed because demand and supply will be less elastic in the first year than in the eighth year. b) first year after it is imposed than in the eighth year after it is imposed because demand and supply will be more elastic in the first year than in the eighth year. c) eighth year after it is imposed than in the first year after it is imposed because demand and supply will be less elastic in the first year than in the eighth year. d) eighth year after it is imposed than in the first year after it is imposed because demand and supply will be more elastic in the first year than in the eighth year.

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ewomazinoade ewomazinoade · Answer 1 · 2020-06-05T02:03:51+02:00

Answer:

c) eighth year after it is imposed than in the first year after it is imposed because demand and supply will be less elastic in the first year than in the eighth year.

Explanation:

Tax increases the price of a good.

Dead weight loss is reduction in efficiency as a result of taxation.

Demand and supply is usually less elastic in the short run when compared to the long run. I the short run, consumers and producers don't have enough time to search for suitable substitutes.

So in the short run, there would be little or no change in demand or supply but in the long run, consumers would be able to search for more subsituites so the deadweight loss would be greater.

I hope my answer helps you