The Burden of a Tax Will Fall Primarily on Sellers

question 146

Multiple Choice

The burden of a tax will fall primarily on sellers when the

• A) demand for the product is highly inelastic and the supply is relatively elastic.
• B) demand for the product is highly elastic and the supply is relatively inelastic.
• C) tax is legally (statutorily) imposed on the seller of the product.
• D) tax is legally (statutorily) imposed on the buyer of the product.

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Definitions:

Negative Punishment

A behavior modification technique involving the removal of a desirable stimulus to decrease the probability of an undesirable behavior being repeated.

Negative Reinforcement

A process that strengthens a behavior by removing or reducing an undesirable outcome when the behavior is performed.

Positive Reinforcement

The process of increasing the likelihood of a behavior by following it with the addition of a pleasurable stimulus or reward.

Negative Punishment

A behavior modification technique involving the removal of a desirable stimulus after a particular behavior is exhibited, with the intention of decreasing that behavior.