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Which Statement Is TRUE of a Tax Imposed on a Product

Question 35

Multiple Choice

Which statement is TRUE of a tax imposed on a product sold by a monopolist?

A) Monopolists bear more of the tax when the tax is imposed on consumers than if the tax is levied on the monopolist.
B) Monopolists bear more of the tax when the tax is levied on the monopolist than if the tax is levied on consumers.
C) The tax burden of consumers is the same whether the tax is levied on the monopolist or on consumers.
D) Consumers bear more of the tax when the tax is levied on the monopolist than if the tax is levied on consumers.

Correct Answer: