When supply is inelastic and demand is elastic the tax incidence falls on quizlet?

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When supply inelastic and demand is elastic What is the tax incidence falls on?
When demand is inelastic and supply is elastic the burden of a tax falls mainly on producers quizlet?
When demand is elastic and supply is inelastic the burden of a tax falls mainly on consumers?
What happens to tax when supply is inelastic?

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When supply inelastic and demand is elastic What is the tax incidence falls on?

When supply is inelastic and demand is elastic, the tax incidence falls on the producer. When supply is elastic and demand is inelastic, the tax incidence falls on the consumer.

When demand is inelastic and supply is elastic the burden of a tax falls mainly on producers quizlet?

Terms in this set (110) An excise tax can distort incentives and create missed opportunities for mutually beneficial transactions. When demand is elastic and supply is inelastic, the burden of a tax falls mainly on consumers. When demand is inelastic and supply is elastic, the burden of a tax falls mainly on producers.

When demand is elastic and supply is inelastic the burden of a tax falls mainly on consumers?

Tax incidence can also be related to the price elasticity of supply and demand. When supply is more elastic than demand, the tax burden falls on the buyers. If demand is more elastic than supply, producers will bear the cost of the tax.

What happens to tax when supply is inelastic?

When a tax is introduced in a market with an inelastic supply—such as, for example, beachfront hotels—sellers have no choice but to accept lower prices for their business. Taxes do not greatly affect the equilibrium quantity. The tax burden in this case is on the sellers.