Of the two classes of participants in a market, buyers and sellers, the one who pays most of an excise tax is the one with the greater elasticity.

Question

Quizplus · Accepted Answer

The party (buyers or sellers) with the lesser elasticity (i.e., less responsive to price changes) bears more of the excise tax burden, as they are less likely to change their quantity demanded or supplied in response to the tax-induced price change.

Of the Two Classes of Participants in a Market, Buyers