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    Principles of Economics Study Set 8
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    Exam 8: Applications: The Costs of Taxation
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    The Demand for Energy Drinks Is More Elastic Than the Demand
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The Demand for Energy Drinks Is More Elastic Than the Demand

Question 16

Question 16

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The demand for energy drinks is more elastic than the demand for milk. Would a tax on energy drinks or a tax on milk have a larger deadweight loss? Explain.

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A tax on energy drinks would have a larg...

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