If the demand for a product is perfectly elastic and supply is upsloping, a $1 excise tax per unit on suppliers will

Name: If the demand for a product is perfectly elastic and supply is upsloping, a $1 excise tax per unit on suppliers will
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Question

Quizplus · Accepted Answer

If demand is perfectly elastic, any increase in price would cause a complete loss of demand. Therefore, the tax will be absorbed entirely by the supplier and will not be passed on to the consumer in the form of a price increase.

If the Demand for a Product Is Perfectly Elastic and Supply