Do we get the same result if we have consumers or firms pay the tax to the government with a perfectly inelastic supply curve? To support your answer, use Word's Drawing Tools to draw graphs. Explain the graphs and the result. 

Q2. Use Word's Drawing Tools to draw a graph where supply is more inelastic than demand at the initial equilibrium price. Apply a quantity tax. Comment on the tax incidence and deadweight loss.

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Question 1 If we have consumers or firms pay the tax to the government with a perfectly inelastic supply curve the result will be the same in terms of tax incidence regardless of whether consumers or ... View the full answer