If a policymaker wants to raise revenue by taxing goods while minimizing the deadweight losses, he should look for goods with elasticities of demand and elasticities of supply.
A. small,small B. small, large C. large,small D. large,large

The greater the elasticities of supply and demand, the greater the deadweight loss of a tax and vice versa. Tax raises the price the buyer pay, lowers the price the sellers receive and reduces the quantity sold. Therefore a greater reduction in the quantity exchange in the market causes a greater deadweight loss; and deadweight loss increases as tax increases.

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If a policymaker wants to raise revenue by taxing goods while minimizing the deadweight losses, he should look for goods with ________ elasticities of demand and ________ elasticities of supply. A. small,small B. small, large C. large,small D. large,large

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If a policymaker wants to raise revenue by taxing goods while minimizing the deadweight losses, he should look for goods with elasticities of demand and elasticities of supply.
A. small,small B. small, large C. large,small D. large,large