Suppose that in a particular market, the demand curve is highly elastic, and the supply curve...

Suppose that in a particular market, the demand curve is highly elastic, and the supply curve is highly inelastic. If a tax is imposed in this market, then the

Question 25 options:

	buyers will bear a greater burden of the tax than the sellers.
	sellers will bear a greater burden of the tax than the buyers.
	buyers and sellers are likely to share the burden of the tax equally.
	buyers and sellers will not share the burden equally, but it is impossible to determine who will bear the greater burden of the tax without more information.

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Expert Solution

Rahul Sunny answered 1 year ago

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