The quantity supplied of land is constant regardless of price. Suppose a tax is imposed on the rental price of land. Who will pay the greater share of such a tax? Group of answer choices The buyers will pay the entire share.

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Stein

Business

10 January, 15:30

The quantity supplied of land is constant regardless of price. Suppose a tax is imposed on the rental price of land. Who will pay the greater share of such a tax? Group of answer choices The buyers will pay the entire share.

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Answers (1)

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Arely Meza · Answer 1

The sellers will pay the entire share.

Explanation:

If the quantity of the land supplied is constant, it does not increase. So if the tax is imposed on the land, the price of land will definitely go up because of the limitation in the quantity of the land available.

If the tax is imposed on the rental price of the land which will lead to increase in the price of that land, then the tax has to be paid by the sellers of that particular land.