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- Subject
- Prices, Wages & Taxeseconomics-mcqs › prices-wages-taxes
- Published
- 30 May 2019
- Last updated
- 28 May 2026
If a tax is imposed on buyers in a market, what is the effect on the distribution of the tax burden?
Multiple choice question for Prices, Wages & Taxes. Select an option, then review the explanation below.
Explanation
Whether a tax is levied on buyers or sellers, the economic incidence—the actual division of the tax burden between buyers and sellers—remains the same. This means that taxing buyers results in the same distribution of tax burden as taxing sellers.
More Prices, Wages & Taxes MCQs
Practice related questions from the same subject.
- 1.Which statement accurately describes how the tax burden is allocated?
- 2.When a tax is imposed on an essential product, who is most likely to bear the majority of the tax burden?
- 3.In the supply and demand framework, when a tax is imposed on sellers of a product, which curve shifts and in what direction?
- 4.Which type of employee is most likely to face greater challenges in securing employment following an increase in the minimum wage?
- 5.Which of the following illustrates a price floor in economic terms?