Asked by Lucia Cantu on May 10, 2024
Verified
The distribution of the burden of a tax depends strictly on the elasticity of demand.
Elasticity of Demand
A measure of how much the quantity demanded of a good responds to a change in the price of that good, with all other things being equal.
- Study the factors that decide the allocation of tax incidence between consumers and sellers.
Verified Answer
MC
Melinda CooperMay 12, 2024
Final Answer :
False
Explanation :
The distribution of the tax burden depends on both the elasticity of demand and the elasticity of supply.
Learning Objectives
- Study the factors that decide the allocation of tax incidence between consumers and sellers.