If a Tax Is Placed on Suppliers of a Good,then

question 201

Multiple Choice

If a tax is placed on suppliers of a good,then the incidence of the tax

• A) falls more on the sellers if demand is elastic.
• B) falls more on the sellers if demand is inelastic.
• C) is usually split equally between the buyers and the sellers.
• D) usually falls more on the sellers than the buyers.
• E) usually falls more on the buyers than the sellers.

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Definitions:

Substitutes

Products or services that can replace each other in use or consumption, thereby affecting consumer choices and market dynamics.

Product

An item or service that is created through a process and is offered for sale or use.

Luxury Goods

High-end products and services that are perceived to be more prestigious and are usually purchased by individuals with more disposable income.

Price Elastic

Refers to the degree to which the quantity demanded or supplied of a good or service changes in response to a change in its price.