If Demand Is Perfectly Elastic, a Sales Tax Is Paid

question 279

Multiple Choice

If demand is perfectly elastic, a sales tax is paid by

• A) only the buyers.
• B) only the sellers.
• C) both the buyers and sellers.
• D) None of the above answers is correct.

---

Definitions:

MP-3 Player

A portable digital device designed to play audio files in the MP3 format, allowing for the storage and playback of music and other audio.

Tax

A compulsory contribution to state revenue, levied by the government on workers' income and business profits, or added to the cost of some goods, services, and transactions.

Deadweight Loss

An economic inefficiency arising when a good or service fails to meet its free market equilibrium point.

Taxes

Mandatory payments made to the government, taken from individuals' earnings and the profits of businesses, or incorporated into the price of certain products, services, and financial dealings.