Figure 6-36
-Refer to Figure 6-36.If the government places a $2 tax in the market,the seller bears $1 of the tax burden.

Name: Figure 6-36 -Refer to Figure 6-36.If the government places a $2 tax in the market,the seller bears $1 of the tax burden.
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Question

Figure 6-36 
-Refer to Figure 6-36.If the government places a $2 tax in the market,the seller bears $1 of the tax burden.

Quizplus · Accepted Answer

The tax burden is shared between buyers and sellers depending on the elasticity of demand and supply. If the seller bears $1 of the $2 tax, it indicates that the burden is split equally, which can occur if both demand and supply are equally elastic.

Figure 6-36 -Refer to Figure 6-36.If the Government Places a $2 Tax