Refer to Figure 4-10. Suppose the market is initially in equilibrium at price P1 and now the government imposes a tax on every unit sold. Which of the following statements best describes the impact of the tax? For demand curve D1
A) the producer bears the entire burden of the tax if the supply curve is S2 and the consumer bears the entire burden of the tax if the supply curve is S1.
B) the producer bears a smaller share of the tax burden if the supply curve is S2.
C) the producer's share of the tax burden is the same whether the supply curve is S1 or S2.
D) the producer bears a smaller share of the tax burden if the supply curve is S1.
D
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Indifference curves intersect at the point of utility maximization
Indicate whether the statement is true or false
Some economists believe that monopolies are both inevitable and beneficial to society. They believe that monopolies are more efficient than competitive markets and generate lower prices. For these reasons they oppose _________ and advocate __________
a. antitrust laws; laissez-faire b. laissez-faire; antitrust laws c. nationalization; regulation d. regulation; nationalization e. antitrust laws; nationalization