Question: The demand for root beer is more inelastic than the demand for falafel. Suppose the government levies an equivalent tax on root beer and falafel.
The demand for root beer is more inelastic than the demand for falafel. Suppose the government levies an equivalent tax on root beer and falafel. The deadweight loss would be larger in the market for falafel than in the market for root beer because the quantity of falafel would fall by more than the quantity of root beer. root beer than in the market for falafel because the quantity of root beer would fall by more than the quantity of falafel. root beer than in the market for falafel because the quantity of falafel would fall by more than the quantity of root beer. falafel than in the market for root beer because the quantity of root beer would fall by more than the quantity of falafel
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