Question

If the government levies a $5 tax per ticket on buyers of NFL game tickets, then the price paid by buyers of NFL game tickets would Question 7 options: a) increase by less than $5. b) decrease by an indeterminate amount. c) increase by more than $5. d) increase by exactly $5.

Answer 1

increase by less than $5

Step-by-step explanation:

A tax is a compulsory amount levied by the government or an agency of the government on goods and services.

Taxes increases the price of a product.

If a $5 tax is levied on the tickets, the price of the ticket would increase by less than $5. The burden of the tax of $5 would be shared by both buyers and sellers. The party with the less elastic demand / supply would bear the greater burden of the tax.

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