Studies show that most of a payroll tax is paid by workers in the form of lowered wages.If true,these studies imply
A) the supply of labor curve is very steep.
B) the supply of labor curve is very flat.
C) it would be better if employers were made to pay all of the tax.
D) the demand for labor curve is very steep.

Question

Quizplus · Accepted Answer

The implication that most of a payroll tax is paid by workers in the form of lowered wages suggests that the supply of labor is relatively inelastic (steep), indicating that workers are not able to easily reduce the amount of labor they supply in response to the tax.

Studies Show That Most of a Payroll Tax Is Paid