In general,a tax burden falls more heavily on the side of the market that

Question

Quizplus · Accepted Answer

When a market is less elastic, it means that consumers are less responsive to changes in prices. This implies that the burden of the tax will fall more heavily on them, as they will continue to purchase the same quantity of goods despite the increase in price caused by the tax. On the other hand, if a market is more elastic, consumers are more sensitive to changes in prices, and the burden of the tax is more likely to be passed on to producers, who will have to lower their prices to maintain demand. Therefore, option D is the correct answer.

In General,a Tax Burden Falls More Heavily on the Side