The question of who pays the greater amount of a commoditytax is determined by:
A)Congress.
B)the President of the United States.
C)the relative elasticities of demand and supply.(True Answer )Correct
D)the individual who writes the check for the tax.

Question

Quizplus · Accepted Answer

The relative elasticities of demand and supply determine who pays the greater amount of a commodity tax. If the demand for a good is more elastic than its supply, then the producer will bear a greater share of the tax burden. On the other hand, if supply is more elastic than demand, then the consumer will bear a greater burden of the tax. This allocation of the tax burden is based on the principle of supply and demand and market forces, rather than being determined by Congress or the President.

The Question of Who Pays the Greater Amount of a Commoditytax