Answer:
The right answer is: price elasticity of supply and demand.
Explanation:
A tax of $4 per unit on automobile tire supply has been enacted by the government. Suppliers are responsible for this tax. Importantly, the outcome will remain unchanged regardless of whether the burden is on the buyer or the seller. Enforcing this tax will result in a rise in the commodity's price.
The distribution of the tax burden between buyers and sellers directly correlates with demand and supply elasticity. If demand is significantly more elastic relative to supply, suppliers will carry a larger portion of the tax burden, and vice versa.
