The burden of a tax that is imposed on a good is said to fall on consumers if:
A) the price paid by consumers for the good declines.
B) the price paid by consumers for the good increases.
C) the wages received by workers who produce the good declines.
D) the wages received by workers who produce the good increases.

Question

Quizplus · Accepted Answer

When a tax is imposed on a good, the producer may decide to pass on some or all of the tax to the consumer by increasing the price of the good. Therefore, the burden of the tax falls on consumers as they end up paying a higher price for the good.

The Burden of a Tax That Is Imposed on a Good