Suppose that accountants increase the price for calculating income taxes owed by 20 percent. The short-run demand for their service is less elastic than the long-run demand because in the long run consumers will
A) spend less on this service.
B) experience an increase in income.
C) try to avoid paying their income tax.
D) find other ways to calculate the income tax they must pay.

Question

Quizplus · Accepted Answer

In the long run, consumers have more time to find alternatives, such as using tax software or learning to do taxes themselves, making demand more elastic.

Suppose That Accountants Increase the Price for Calculating Income Taxes