suppose the demand curve for a product is vertical and the supply curve is upward sloping. if a unit tax is…

suppose the demand curve for a product is vertical and the supply curve is upward sloping. if a unit tax is imposed in the market for this product, a. buyers bear the entire burden of the tax. b. buyers share the burden of the tax with government. c. the tax burden will be shared equally between buyers and sellers. d. sellers bear the entire burden of the tax.

suppose the demand curve for a product is vertical and the supply curve is upward sloping. if a unit tax is imposed in the market for this product, a. buyers bear the entire burden of the tax. b. buyers share the burden of the tax with government. c. the tax burden will be shared equally between buyers and sellers. d. sellers bear the entire burden of the tax.

Answer

Brief Explanations:

When demand is perfectly inelastic (vertical demand curve), consumers' quantity demanded does not change regardless of price. Sellers can pass on the entire tax to buyers by increasing the price, so buyers bear the whole tax burden.

Answer:

A. buyers bear the entire burden of the tax.