When a tax is assessed on producers,
A)the amount of the product traded does not change because demand is unaffected.
B)the price of the product does not change because the tax is on producers.
C)consumers bear the brunt of the tax because producers simply pass their costs on to the buyers of the good.
D)the price of the product always goes up by the amount of the tax.
E)the product price typically does not rise by the full amount of the tax.

Question

Quizplus · Accepted Answer

When a tax is assessed on producers, the burden is typically shared between producers and consumers, so the price does not rise by the full amount of the tax.

When a Tax Is Assessed on Producers