A tax on a commodity whose demand is perfectly inelastic will fall heavily on the
Answer Details
A tax on a commodity whose demand is perfectly inelastic will fall heavily on the consumer.
Demand for a product is considered perfectly inelastic when consumers are willing to pay the same price regardless of changes in supply or price. In other words, a change in price will have little to no effect on the amount of the product that consumers are willing to purchase.
When a tax is imposed on a commodity with perfectly inelastic demand, the price of the product will increase. Since consumers are willing to pay the same price regardless of the increase, the burden of the tax falls heavily on them.
The manufacturer, wholesaler, and retailer may also be impacted by the tax, but they can pass on some or all of the tax to the consumer in the form of a higher price. This is because they have some ability to adjust their prices based on changes in supply and demand.
Overall, a tax on a commodity with perfectly inelastic demand is likely to fall heavily on the consumer, as they are unable to adjust their behavior in response to the increase in price.