If demand is price inelastic, a tax will largely be paid by consumers.

Name: If demand is price inelastic, a tax will largely be paid by consumers.
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Question

Quizplus · Accepted Answer

If demand is price inelastic, it means that consumers are relatively unresponsive to changes in price. Therefore, if a tax is imposed on the product, the price will increase and consumers will still continue to buy the product, despite the higher price. As a result, the burden of the tax will largely fall on consumers.

If Demand Is Price Inelastic, a Tax Will Largely Be