Suppose that there are three types of markets with different degrees of price elasticity. In Market 1, the demand curve is perfectly inelastic and the supply curve is relatively steep. In Market 2, the supply curve is relatively flat and the demand curve is relatively steep. In Market 3, the supply curve is relatively steep and the demand curve is relatively flat. Which of the following statements is (are) correct?

(x) All of the burden of the tax is imposed on the buyer in Market 1.

(y) The majority of a tax will be paid by the buyer in Market 2 because supply is less elastic than demand in that market.

(z) The majority of a tax will be paid by the seller in Market 3 because supply is more elastic than demand in that market.

Select one:

A.

(x), (y) and (z)

B.

(x) and (y) only

C.

(x) and (z) only

D.

(y) and (z) only

E.

(x) only