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

Answer :

In case of perfectly elastic demand producer of a product not able to pass any excise tax to consumers. Because in case of perfectly elastic demand a very small change in price will result a very large change in quantity demanded. Being sensitive for price of the goods, consumer isn't ready to even small rise in price and they will reduce their quantity demanded. So the producer enable to pass excise tax ( which will be added in price and increase the price) to consumers.