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If demand for a good is perfectly inelastic, the entire economic burden of a specific sales tax falls on:

AThe producers/sellers
BThe consumers
CThe government treasury
DForeign exporters

Explanation

When demand is perfectly inelastic, consumers buy the same quantity regardless of price, allowing sellers to shift 100% of the tax burden to buyers.

Submitted by: mcqstutor Team More Economics MCQs →

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