The burden of a tax falls more heavily on the buyers in a market when a. demand is inelastic and supply is elastic b. demand is elastic and supply is inelastic c. both supply and demand are elastic d. both supply and demand are inelastic

The burden of a tax in a market is distributed between buyers and sellers based on the **elasticity** of both **demand** and **supply**: - **Elasticity of Demand**: If demand is **inelastic**, consumers are less sensitive to price changes, meaning they will bear a larger portion of the tax burden. - **Elasticity of Supply**: If supply is **elastic**, producers can more easily adjust their production in response to price changes, meaning they can pass more of the tax burden onto consumers. Given these relationships: - **Option a.** *Demand is inelastic and supply is elastic* - **Demand is Inelastic**: Consumers bear a larger portion of the tax. - **Supply is Elastic**: Producers can pass more of the tax to consumers. - **Conclusion**: The burden falls more heavily on buyers. - **Option b.** *Demand is elastic and supply is inelastic* - **Demand is Elastic**: Consumers can reduce their quantity demanded, so producers bear more of the tax. - **Supply is Inelastic**: Producers cannot easily adjust, so they bear more of the tax. - **Option c.** *Both supply and demand are elastic* - Both parties can adjust their behavior, leading to a more equal distribution of the tax burden. - **Option d.** *Both supply and demand are inelastic* - Both parties bear a significant portion of the tax, but the exact distribution depends on the relative inelasticities. **Therefore, the correct answer is:** **a. demand is inelastic and supply is elastic**