The Market Supply of Labor Is Perfectly Inelastic

Multiple Choice

The market supply of labor is perfectly inelastic. However, the income effect of tax-induced wage changes are believed to be substantial. Then it follows that a tax on labor income will:

A) have zero excess burden.
B) have positive excess burden.
C) be paid entirely by workers as a reduction in net wages.
D) both a and c
E) both b and c