Figure 6.9 depicts a hypothetical fish market with a horizontal supply curve. Suppose the government imposes a tax of $2 per pound of fish, and the tax is paid in legal terms by producers. If the supply curve were positively sloped:

A. producers would bear the full cost of the tax.
B. consumers would bear the full cost of the tax.
C. both producers and consumers share the tax.
D. There is not sufficient information.


Answer: C

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