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Do you care whether a 15c tax per gallon of milk is collected from milk producers or from consumers at the store? Why? As a c

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Answer #1

Answer

No,

The incidence of a tax does not change. It is applied to consumer or producer.

Option A

A tax on a good is applied then the incidence of the tax depends on the elasticities of demand and supply. A consumer gets more burden if the demand is less elastic than supply and vice versa.

A producer or consumers are taxed; then there is no difference in the effect.

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