Answer
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Work Step by Step
When consumers are very price sensitive, the supplier cannot pass along tax without a large impact on quantity sold.
Microeconomics: Principles, Applications, and Tools (8th Edition)
by O'Sullivan, Arthur; Sheffrin, Steven; Perez, Stephen
Published by
Prentice Hall
ISBN 10:
0-13294-886-9
ISBN 13:
978-0-13294-886-9
Chapter 6 - Market Efficiency and Government Intervention - Exercises - 6.5 Who Really Pays Taxes? - Page 150: 5.4
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