The sellers pay the entire sales tax levied on a good when demand is perfectly ________ or supply is perfectly ________.

Name: The sellers pay the entire sales tax levied on a good when demand is perfectly ________ or supply is perfectly ________.
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Question

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When demand is perfectly elastic, consumers will not tolerate any price increase, so sellers must absorb the tax. When supply is perfectly inelastic, sellers cannot change the quantity supplied, so they bear the tax burden.

The Sellers Pay the Entire Sales Tax Levied on a Good