In the long run,the greater burden of a specific tax will usually be absorbed by
A)consumers.
B)the party consumers or producers with the more elastic demand/supply curve.
C)the party with the least elastic demand/supply curve.
D)shareholders and employees of the firm in the form of reduced dividends and wages.

Question

Quizplus · Accepted Answer

The greater burden of a specific tax will usually be absorbed by the party with the least elastic demand/supply curve, because they are less responsive to price changes and cannot easily avoid the tax by changing their quantity demanded or supplied.

In the Long Run,the Greater Burden of a Specific Tax