A product with perfectly elastic supply has sales of 100 units per week at a price of £2 per unit. Price elasticity of demand is(-)1 .5 over the relevant range. The government imposes a tax 20%. What will be the government’s weekly tax revenue?

£28

JI
Answered by Jamie I. Economics tutor

2473 Views

See similar Economics A Level tutors

Related Economics A Level answers

All answers ▸

How does business confidence affect the economic cycle? And why?


What are tariffs and why are they used?


What factors affect supply of a good or service?


Explain, using a diagram, how a firm might use third degree price discrimination to increase their profits.


We're here to help

contact us iconContact ustelephone icon+44 (0) 203 773 6020
Facebook logoInstagram logoLinkedIn logo

MyTutor is part of the IXL family of brands:

© 2026 by IXL Learning