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Minnesota and Tennessee, among other states have recently began to tax the sale of health care providers such as hospitals and physicians. Analyze the incidence

Minnesota and Tennessee, among other states have recently began to tax the sale of health care providers such as hospitals and physicians. Analyze the incidence of this sales tax for three different scenarios. The demand for medical services is completely inelastic, while the supply curve is positively sloped to the right. b. the demand curve is downward sloping and supply is completely inelastic (for this case, it is best to shift the demand curve downward by the amou8nt of the per unit tax) and c. the demand curve is downward sloping and the supply curve is positively sloped. When does the consumer or health care provider pay a larger portion of the tax? Why?

 



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