Concept:Taxing a good with inelastic demand brings more revenue because buyers continue to purchase almost the same quantity even after the price rises.
Explanation:When the government increases the tax on a commodity, the market price of that commodity rises.
If the demand for that good is inelastic, the percentage fall in the quantity demanded is very small.
This means the total tax collected increases, since revenue depends on the quantity sold multiplied by the tax per unit.
In contrast, if the demand is elastic, consumers will cut their purchases heavily, reducing tax revenue.
Alcoholic beverages are habit-forming and generally have inelastic demand, so higher taxes on them will not drastically reduce their sale.
Hence, they are an appropriate target for increasing government tax revenue.
Answer:B. Alcoholic beverages with inelastic demand