Answer to Question #48498 in Microeconomics for kate

Question

Assume a perfectly competitive industry where the firms are identical, each with U-shaped short run and long run average cost curves. In the short run, consumers bear none of the burden of a “per firm” tax, while in the long run, consumers bear the entire burden. Explain why this is true, false, or uncertain.

Answer 1

This is said to be true because mostly during the short run a firm normally incures more costs in advertising the products and reducing the price of goods to attract demand, hence low prices to consumers shows that they dont bear tax.
So, the statement is true.