A tax levied independent of output,such as a tax levied on net income of corporations,will

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Quizplus · Accepted Answer

The tax levied independent of output, such as a tax on net income of corporations, will not be shifted in the short run if the most profitable output has been selected before the tax. This is because the tax does not affect the production decision made by the firm, and the firm will continue producing the same level of output. As a result, the burden of the tax will be borne by the firm and not transferred to the consumers in the form of higher prices.

A Tax Levied Independent of Output,such as a Tax Levied