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It Does Not Matter Whether a Tax Is Levied on the Buyers

Question 1

Multiple Choice

It does not matter whether a tax is levied on the buyers or the sellers of a good because


A) sellers always bear the full burden of the tax.
B) buyers always bear the full burden of the tax.
C) buyers and sellers will share the burden of the tax.
D) None of the above is correct;the incidence of the tax does depend on whether the buyers or the sellers are required to pay the tax.

Correct Answer:

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