If a Tax Is Imposed on the Buyers of a Product

question 157

True/False

If a tax is imposed on the buyers of a product, then the tax burden will fall entirely on the buyers.

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Definitions:

Direct Labor

The wages paid to employees who are directly involved in the production of goods or provision of services, considered a variable cost.

Direct Labor Rate

The cost per hour for labor directly involved in the production of goods or services.

Indirect Labor Rate

The cost of labor that cannot be directly traced to the production of goods or services, but is necessary for the process.