The side of the market that will bear a greater share of the tax burden is the side that:

Question

Quizplus · Accepted Answer

The side of the market that will bear a greater share of the tax burden is the one that responds less to a change in prices. This is because if a group (either consumers or producers) is less sensitive to price changes (i.e., has inelastic demand or supply), they cannot easily avoid the tax by changing their buying or selling behavior, leading them to bear a larger portion of the tax burden.

The Side of the Market That Will Bear a Greater