Question

under what elasticity conditions will producers of a product be able to pass NONE of an excise tax to consumers? explain in a couple of sentences

Answer 1

If supply is more inelastic than demand, sellers bear most of the tax burden.
Think about it this way—when the demand is inelastic, consumers are not very responsive to price changes, and the quantity demanded remains relatively constant when the tax is introduced. When a tax is introduced in a market with an inelastic supply—such as, for example, beachfront hotels—sellers have no choice but to accept lower prices for their business. Taxes do not greatly affect the equilibrium quantity. The tax burden in this case is on the sellers.

In the case of tobacco, the tax burden falls on the most inelastic side of the market. If demand is more inelastic than supply, consumers bear most of the tax burden.

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