Hey there! Sign in to join this conversationNew here? Join for free
    • Thread Starter
    Offline

    18
    ReputationRep:
    What happens if demand/supply is more elastic for a product what is the effect on consumers and producers for taxation who pays more of the burden and for a subsidy who gains more of the benefit.

    What happens if demand/supply is more inelastic for a product what is the effect on consumers and producers for taxation who pays more of the burden and for a subsidy who gains more of the benefit.

    Thanks
    Offline

    2
    ReputationRep:
    (Original post by ineedtorevise127)
    What happens if demand/supply is more elastic for a product what is the effect on consumers and producers for taxation who pays more of the burden and for a subsidy who gains more of the benefit.

    What happens if demand/supply is more inelastic for a product what is the effect on consumers and producers for taxation who pays more of the burden and for a subsidy who gains more of the benefit.

    Thanks
    Hi ineedtorevise127,

    Below are 4 diagrams with different scenarios in which I think relate back to what you're on about in your Original Post.

    The buyers and suppliers incidence fluctuates dependent on how elastic something is.

    Just ask if you don't understand something!

    Thanks,
    Alex :cool:
    Attached Images
     
    • Thread Starter
    Offline

    18
    ReputationRep:
    (Original post by Alex-Torres)
    Hi ineedtorevise127,

    Below are 4 diagrams with different scenarios in which I think relate back to what you're on about in your Original Post.

    The buyers and suppliers incidence fluctuates dependent on how elastic something is.

    Just ask if you don't understand something!

    Thanks,
    Alex :cool:


    Thanks so much so helpful!
    Do you know what is the case for a subsidy when demand is inelastic/elastic and supply is inelastic/elastic.
    Who gets more of the benefits e.g. producers or consumers.
    Really stuck on this!
    Offline

    2
    ReputationRep:
    (Original post by ineedtorevise127)
    Thanks so much so helpful!
    Do you know what is the case for a subsidy when demand is inelastic/elastic and supply is inelastic/elastic.
    Who gets more of the benefits e.g. producers or consumers.
    Really stuck on this!
    I don't really understand what you're asking, because you've stated demand being both inelastic and elastic? That is theoretically impossible.
    • Thread Starter
    Offline

    18
    ReputationRep:
    (Original post by Alex-Torres)
    I don't really understand what you're asking, because you've stated demand being both inelastic and elastic? That is theoretically impossible.

    Lol sorry for the wording.
    I mean say we have two different situations e.g. apples and education

    e.g. subsidising education - it is inelastic in demand

    If you subsidize it who would get more of the benefits from the incidence of subsidy consumers or producers.

    e.g. apples - elastic in demand
    if you subsidize it who would get more benefit from incidence of subsidy consumers or producers
    Offline

    2
    ReputationRep:
    (Original post by ineedtorevise127)
    Lol sorry for the wording.
    I mean say we have two different situations e.g. apples and education

    e.g. subsidising education - it is inelastic in demand

    If you subsidize it who would get more of the benefits from the incidence of subsidy consumers or producers.

    e.g. apples - elastic in demand
    if you subsidize it who would get more benefit from incidence of subsidy consumers or producers
    You can apply this to the diagram, the top right one. Demand is elastic, so the supplier gains!
 
 
 
  • See more of what you like on The Student Room

    You can personalise what you see on TSR. Tell us a little about yourself to get started.

  • Poll
    Did TEF Bronze Award affect your UCAS choices?
  • See more of what you like on The Student Room

    You can personalise what you see on TSR. Tell us a little about yourself to get started.

  • The Student Room, Get Revising and Marked by Teachers are trading names of The Student Room Group Ltd.

    Register Number: 04666380 (England and Wales), VAT No. 806 8067 22 Registered Office: International House, Queens Road, Brighton, BN1 3XE

    Quick reply
    Reputation gems: You get these gems as you gain rep from other members for making good contributions and giving helpful advice.