When demand is perfectly inelastic the buyer pays _____ of a tax.
A)all
B)most
C)half
D)less than half
E)none

Question

Quizplus · Accepted Answer

When demand is perfectly inelastic, it means that the quantity demanded does not change regardless of any change in price. This implies that the burden of a tax will fall entirely on the buyer, and as a result, the buyer will end up paying all of the tax. Therefore, the best answer is A, "all".

When Demand Is Perfectly Inelastic the Buyer Pays _____ of a Tax