Suppose that there is a tax of $5 per unit, and the demand curveis more elastic than the supply curve. Which of the followingstatements could be true?
A)Buyers pay $3 of the tax.
B)Buyers pay $1 of the tax.
C)Sellers pay $1 of the tax.
D)Sellers pay all of the tax.

Question

Suppose that there is a tax of $5 per unit, and the demand curveis more elastic than the supply curve. Which of the followingstatements could be true?
A)Buyers pay $3 of the tax. 
B)Buyers pay $1 of the tax. 
C)Sellers pay $1 of the tax. 
D)Sellers pay all of the tax.

Quizplus · Accepted Answer

The Answer of  Suppose that there is a tax of $5 per unit, and the demand curveis more elastic than the supply curve. Which of the followingstatements could be true?
A)Buyers pay $3 of the tax. 
B)Buyers pay $1 of the tax. 
C)Sellers pay $1 of the tax. 
D)Sellers pay all of the tax.

Suppose That There Is a Tax of $5 Per Unit