The more elastic the demand for a good,
A)the more of an excise tax is that is collected by sellers
B)the more of an excise tax that is paid by buyers
C)the more an excise that is paid by sellers
D)the more elastic the supply of that good
E)the smaller the burden of a tax on that good

Question

Quizplus · Accepted Answer

When demand is more elastic, sellers bear a larger burden of the excise tax because buyers are more sensitive to price changes and will reduce their quantity demanded significantly if prices rise.

The More Elastic the Demand for a Good