If the supply curve is perfectly elastic, then this suggests that the OA. consumers pay a smaller portion of the excise tax. OB. consumer price does not change when an excise tax is added to the sale of a good OC. entire burden of the excise tax is borne by the sellers. OD. sellers absorb a portion of the excise tax. O E. entire burden of the excise tax is borne by the consumers.

Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter8: Application: The Cost Of Taxation
Section: Chapter Questions
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If the supply curve is perfectly elastic, then this suggests that the
O A. consumers pay a smaller portion of the excise tax.
OB. consumer price does not change when an excise tax is added to the sale of a good
OC. entire burden of the excise tax is borne by the sellers.
O D. sellers absorb a portion of the excise tax.
O E. entire burden of the excise tax is borne by the consumers.
Transcribed Image Text:If the supply curve is perfectly elastic, then this suggests that the O A. consumers pay a smaller portion of the excise tax. OB. consumer price does not change when an excise tax is added to the sale of a good OC. entire burden of the excise tax is borne by the sellers. O D. sellers absorb a portion of the excise tax. O E. entire burden of the excise tax is borne by the consumers.
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