NABTEB Economics 2024 Objective — Question 41
Question 41 of 50 from the National Business and Technical Examinations Board (NABTEB) Economics 2024 Objective paper, with the correct answer and a full explanation.
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A commodity with perfectly inelastic demand has the burden of tax borne by
- A. A. both the sellers and the buyers
- B. B. the buyers aloneCorrect
- C. C. the government alone
- D. D. both the buyers and the government
Explanation
A tax burden charged or imposed on a commodity whose demand is perfectly inelastic (zero elastic) is borne entirely by the consumers or buyers alone while that of perfectly elastic demand is borne by the sellers alone.
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