<P> If , in contrast to the previous example , the producer is perfectly inelastic , he will continue producing the same quantity no matter the price . In case that the consumer is elastic ; the consumer becomes very sensitive and weary of the price ( Melville 24 ) . A small increase in the price of something leads to a large drop in the quantity that is being demanded . The imposition of taxes causes the market price to have an increase from P without taxes . It rises to P with taxes . In most markets , elasticities of the supply and demand are similar to the short - run and result in the burden of the taxes that has been imposed . The tax that has been imposed is shared between two groups and in varying proportions . In general , the group that will have a greater tax burden is the one that exhibits greater relative inelasticity ( Prasad 49 ) . When there is an increase in elasticity in one place , the demand for the quantity changes so that it can suit the different needs that have been set by the tax burden . Tax burden , therefore , varies a lot with elasticity in materials . </P>
<P> If , in contrast to the previous example , the producer is perfectly inelastic , he will continue producing the same quantity no matter the price . In case that the consumer is elastic ; the consumer becomes very sensitive and weary of the price ( Melville 24 ) . A small increase in the price of something leads to a large drop in the quantity that is being demanded . The imposition of taxes causes the market price to have an increase from P without taxes . It rises to P with taxes . In most markets , elasticities of the supply and demand are similar to the short - run and result in the burden of the taxes that has been imposed . The tax that has been imposed is shared between two groups and in varying proportions . In general , the group that will have a greater tax burden is the one that exhibits greater relative inelasticity ( Prasad 49 ) . When there is an increase in elasticity in one place , the demand for the quantity changes so that it can suit the different needs that have been set by the tax burden . Tax burden , therefore , varies a lot with elasticity in materials . </P>
who pays the greater burden of the tax
who pays the greater burden of the tax
the group that will have a greater tax burden is the one that exhibits greater relative inelasticity
the group that will have a greater tax burden is the one that exhibits greater relative inelasticity