22、For markets with perfectly elastic supply and perfectly inelastic supply, respectively, the introduction of a tax will most likely result in: | Markets with perfectly elastic supply | Markets with perfectly inelastic supply | A. | a price increase, and the seller bears the tax. | a price increase, and the buyer bears the tax. | B. | a price increase, and supply remains the same. | no change in price, and the seller bears the tax. | C. | a price increase, and the buyer bears the tax. | no change in price, and the seller bears the tax. | D. | no change in price, and the seller bears the tax. | a price increase, and the buyer bears the tax. |
A. Answer A B. Answer B C. Answer C D. Answer D
Correct answer = C
"Markets in Action," Michael Parkin
2008 Modular Level I, Vol. 2, pp. 75-76
Study Session 4-15-d
discuss the impact of subsidies, quotas, and markets for illegal goods on demand, supply, and market equilibrium
In markets with perfectly elastic supply, price increases as a result of tax and the seller passes on the tax burden to buyers. In markets with perfectly inelastic supply, sellers maintain the same supply and price but absorb the tax burden themselves. | 
发表于 2008-5-27 14:10
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