Buyers will bear the entire burden of a unit tax if the demand curve for a product is

Question

Quizplus · Accepted Answer

When the demand curve is vertical, it means that the quantity demanded is completely insensitive to changes in price. As a result, any increase in the price due to a unit tax would be borne entirely by the buyer, since they would continue to purchase the same quantity of the product regardless of the price increase. This is because the buyer has no alternative products or substitutes to turn to.

Buyers Will Bear the Entire Burden of a Unit Tax