A tax is imposed on a market with elastic demand and inelastic supply.Who bears most of the burden of the tax
A)Buyers will bear most of the burden of the tax.
B)Sellers will bear most of the burden of the tax.
C)The burden of the tax will be shared equally between buyers and sellers.
D)The burden of the tax will be shared equally between buyers and the government.

Question

Quizplus · Accepted Answer

When demand is elastic and supply is inelastic, sellers bear most of the tax burden because they cannot easily reduce the quantity supplied in response to the tax.

A Tax Is Imposed on a Market with Elastic Demand