lecture 11 Flashcards

1
Q

What is tax incidence

A

the division of the burden of a tax between buyers and
sellers.

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2
Q

if the market price rises by the full amount of tax, then the…

A

buyer pays the tax

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3
Q

if the market price rises by a lesser amount than the tax, then…

A

the buyers & sellers share the burden of the tax

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4
Q

If the market price doesn’t rise at all, then…

A

sellers pay the tax

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5
Q
A
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