What is meant by the incidence of a tax

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1. What is meant by the incidence of a tax? How is the incidence of an excise tax related to the elasticities of supply and demand in a market?

2. In the competitive market for hard liquor, the demand is relatively inelastic and the supply is relatively elastic. Will the incidence of an excise tax of $T be greater for consumers or producers?

Reference no: EM131248462

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