About how much of the tax is paid by consumers in the form of higher prices?

A) $1.00
B) $1.35
C) $1.65
D) $2.00
E) $4.00

Question

About how much of the tax is paid by consumers in the form of higher prices?A) $1.00B) $1.35C) $1.65D) $2.00E) $4.00

Monica Maestas · Accepted Answer

Final Answer : B, Explanation :  The amount of tax paid by consumers in the form of higher prices is typically determined by the elasticity of demand and supply. Without additional context, $1.35 is a plausible estimate for the portion of tax passed on to consumers.

About how much of the tax is paid by consumers in the form of higher prices?

A) $1.00
B) $1.35
C) $1.65
D) $2.00
E) $4.00

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