Sales tax on goods where the price elasticity of demand

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Governor Brown, from the state of Taxifornia, wants to increase sales taxes to bring in badly needed revenue to support state operations. He is looking at taxing various goods and services. Will the state tax revenue be greater if the state imposes a sales tax on goods where the price elasticity of demand = .9, or 1.5 ? Explain

Reference no: EM13978299

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