Q. Consider the following statements about impact of tax :1. A tax is shifted forward to consumers if the demand is inelastic relative to supply.2. A tax is shifted backward to producers if the supply is relatively more inelastic than demand.Which of the statements given above is/are correct?

A) 2 only

B) 1 only

C) Neither 1 nor 2

D) Both 1 and 2

✔ Correct Answer: Both 1 and 2

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