Sellers of a good bear the larger share of the tax burden when a tax is placed on a product for which

Name: Sellers of a good bear the larger share of the tax burden when a tax is placed on a product for which
Brand: Quizplus
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Question

Quizplus · Accepted Answer

When demand is more elastic than supply, sellers are unable to pass on the full amount of the tax to consumers because a small increase in price would cause a significant decline in demand. As a result, sellers have to bear the larger share of the tax burden.

Sellers of a Good Bear the Larger Share of the Tax