Use the following to answer question:
-(Figure: Tax Incidence)Use Figure: Tax Incidence.All other things unchanged,when a good or service is characterized by a relatively inelastic supply,as shown in panel _____,a greater share of the burden of an excise tax is borne by _____.

Question

Use the following to answer question: 
-(Figure: Tax Incidence)Use Figure: Tax Incidence.All other things unchanged,when a good or service is characterized by a relatively inelastic supply,as shown in panel _____,a greater share of the burden of an excise tax is borne by _____.

Quizplus · Accepted Answer

When supply is relatively inelastic, sellers cannot easily change the quantity supplied in response to price changes, so they bear a greater share of the tax burden.

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