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If the Producers Bear a Smaller Tax Incidence Than the Buyers

Question 134

Multiple Choice

If the producers bear a smaller tax incidence than the buyers in a market,which of the following must be true?


A) It must be a market for inferior goods.
B) It must be a market for luxury items.
C) Their supply curve must be more elastic than the buyers demand curve in this market.
D) Their supply curve must be less elastic than the buyers demand curve in this market.

Correct Answer:

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