If a $5,000 Tax Is Placed Legally (Statutorily) on the Sellers

question 278

Multiple Choice

If a $5,000 tax is placed legally (statutorily) on the sellers of new automobiles and as a result the price of automobiles to consumers rises by $4,000, then the actual burden of the tax

• A) falls completely on automobile buyers.
• B) falls completely on automobile sellers.
• C) is $4,000 on automobile buyers and $1,000 on sellers.
• D) is $1,000 on automobile buyers and $4,000 on sellers.