Question

Suppose the demand for gasoline is inelastic and the supply of gasoline is elastic. Therefore, ____.

a. buyers bear most of the incidence of a tax on gasoline.

b. sellers bear most of the incidence of a tax on gasoline.

c. the government bears most of the incidence of a tax on gasoline.

d. the incidence of a tax on gasoline depends if the tax is imposed on sellers or on buyers.