Who bears the tax burden if the demand curve is perfectly elastic? a. Sellers b. Buyers...
Who bears the tax burden if the demand curve is perfectly elastic?
a. Sellers
b. Buyers
c. Government
d. Both sellers and buyers
Homework Answers
The burden of the taxation is generally paid by both the consumers as well as the producers. The burden of taxation is dependent upon the elasticity of demand and supply. Whenever the supply is more elastic than the demand the consumer will bear most of the burden of taxation like wise if the demand is more elastic than the supply the producers will bear most of the tax burden. And if the demand is perfectly elastic the producers alone bear the burden of the tax, and if the supply is perfectly elastic the consumers will bear the burden of the tax.
Ans: a). Sellers.
Add Answer to:
Who bears the tax burden if the demand curve is perfectly
elastic?
a. Sellers
b. Buyers...
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Suppose the supply of a good is perfectly elastic while the demand is elastic. The burden of a tax on the drug will A) be shared by the buyers and sellers. B) fall entirely on the sellers. C) fall entirely on the buyers D) fall on neither the buyers nor the sellers.
The economic burden of a tax is borne mostly by: buyers if demand is highly elastic....
The economic burden of a tax is borne mostly by: buyers if demand is highly elastic. O buyers if demand is highly ir plastic. buyers in all cases. sellers in all cases,
Chap.6 Please show that when imposing A Tax on Buyers: Perfectly inelastic demand: Buyers pay the...
Chap.6 Please show that when imposing A Tax on Buyers: Perfectly inelastic demand: Buyers pay the entire tax. Perfectly elastic demand: Sellers pay the entire tax. Perfectly inelastic supply: Sellers pay the entire tax. Perfectly elastic supply: Buyers pay the entire tax.
Tax Problem: Suppose the demand curve for a good is given by Q D = 10...
Tax Problem:
Suppose the demand curve for a good is given by Q D = 10 - 2P and
the supply curve is given by
Q S = -2 + P.
a) (4 points) Find the equilibrium price and quantity in the
absence of any government intervention.
b) (6 points) Now suppose the government imposes a tax of t = 3.
Find the new equilibrium price at
which the good is sold in the market and the quantity of the...
If the demand for a good is perfectly elastic, then a tax on the good will...
If the demand for a good is perfectly elastic, then a tax on the good will be paid O A. completely by the buyers. OB. completely by the sellers. O C. equally by the buyers and sellers. OD. mostly but not completely by the buyers. O E. mostly but not completely by the sellers.
Better electronic answer format, thank you！ 7. Effect of a tax on buyers and sellers The...
Better electronic answer format,
thank you！
7. Effect of a tax on buyers and sellers The following graph shows the daily market for wine. Suppose the government institutes a tax of $46.40 per bottle. This places a wedge between the price buyers pay and the price sellers receive. Supply Tax Wedge PRICE (Dollars per bottle) Demand 0 + 0 + 50 100 400 450 500 150 200 250 300 350 QUANTITY (Bottles of wine) Fill in the following table with...
6. Effect of a tax on buyers and sellers The following graph shows the daily market...
6. Effect of a tax on buyers and sellers The following graph shows the daily market for shoes. Suppose the government institutes a tax of $11.60 per pair. This places a wedge between the price buyers pay and the price sellers receive. Supply Tax Wedge PRICE (Dollars per pair) Demand 0 100 200 800 900 1000 300 400 500 600 700 QUANTITY (Pairs of shoes) Fill in the following table with the quantity sold, the price buyers pay, and the...
7. Effect of a tax on buyers and sellers Suppose the calculator illustrates the market for...
7. Effect of a tax on buyers and sellers Suppose the calculator illustrates the market for wine in the United States. The orange (upward-sloping) line represents the supply curve of wine, and the blue (downward-sloping) line represents the market demand. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. The market is initially in equilibrium. Then the government institutes a $11.60 per bottle tax...
please answer these. Thank you. 29. When a tax is placed on the buyers of coffee,...
please answer these. Thank you.
29. When a tax is placed on the buyers of coffee, the buyers bear the entire burden of the tax b. sellers bear the entire burden of the tax burden of the tax will be always be equally divided between the buyers and the sellers d. burden of the tax will be shared by the buyers and the sellers, but the division of the burden is not always equal 30. the government wants to reduce...
A monopoly has A. A perfectly elastic demand curve B. A perfectly elastic supply curve C....
A monopoly has A. A perfectly elastic demand curve B. A perfectly elastic supply curve C. An inelastic demand curve D. less elastic demand curve than a competitive firm
The economic burden of a tax is borne mostly by: buyers if demand is highly elastic. O buyers if demand is highly ir plastic. buyers in all cases. sellers in all cases,
Tax Problem:
Suppose the demand curve for a good is given by Q D = 10 - 2P and
the supply curve is given by
Q S = -2 + P.
a) (4 points) Find the equilibrium price and quantity in the
absence of any government intervention.
b) (6 points) Now suppose the government imposes a tax of t = 3.
Find the new equilibrium price at
which the good is sold in the market and the quantity of the...
If the demand for a good is perfectly elastic, then a tax on the good will be paid O A. completely by the buyers. OB. completely by the sellers. O C. equally by the buyers and sellers. OD. mostly but not completely by the buyers. O E. mostly but not completely by the sellers.
Better electronic answer format,
thank you！
7. Effect of a tax on buyers and sellers The following graph shows the daily market for wine. Suppose the government institutes a tax of $46.40 per bottle. This places a wedge between the price buyers pay and the price sellers receive. Supply Tax Wedge PRICE (Dollars per bottle) Demand 0 + 0 + 50 100 400 450 500 150 200 250 300 350 QUANTITY (Bottles of wine) Fill in the following table with...
6. Effect of a tax on buyers and sellers The following graph shows the daily market for shoes. Suppose the government institutes a tax of $11.60 per pair. This places a wedge between the price buyers pay and the price sellers receive. Supply Tax Wedge PRICE (Dollars per pair) Demand 0 100 200 800 900 1000 300 400 500 600 700 QUANTITY (Pairs of shoes) Fill in the following table with the quantity sold, the price buyers pay, and the...
7. Effect of a tax on buyers and sellers Suppose the calculator illustrates the market for wine in the United States. The orange (upward-sloping) line represents the supply curve of wine, and the blue (downward-sloping) line represents the market demand. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. The market is initially in equilibrium. Then the government institutes a $11.60 per bottle tax...
please answer these. Thank you.
29. When a tax is placed on the buyers of coffee, the buyers bear the entire burden of the tax b. sellers bear the entire burden of the tax burden of the tax will be always be equally divided between the buyers and the sellers d. burden of the tax will be shared by the buyers and the sellers, but the division of the burden is not always equal 30. the government wants to reduce...
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