If a tax is imposed on a market with elastic demand and inelastic supply:
A) buyers will bear most of the burden of the tax.
B) sellers will bear most of the burden of the tax.
C) the burden of the tax will be shared equally between buyers and sellers.
D) there is no way to determine how the burden of the tax will be shared.

Question

Quizplus · Accepted Answer

When demand is elastic and supply is inelastic, sellers bear most of the tax burden because they cannot easily reduce the quantity supplied, while buyers can reduce the quantity demanded.

If a Tax Is Imposed on a Market with Elastic