3 Questions
Who bears the incidence of an excise tax in a competitive market with perfectly inelastic demand?
Consumers
What happens to the incidence of an excise tax in a competitive market with perfectly elastic demand?
Producers bear the tax
What is the impact of a competitive market with perfectly inelastic demand on the incidence of an excise tax?
Consumers bear the tax
Test your understanding of the incidence of excise taxes on consumers in a competitive market with this quiz. Explore the concept of demand elasticity and discover who really pays the tax in a perfectly inelastic demand scenario.
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