How would the market for coffee be affected if the government charged an excise tax of $1.00 on each unit of coffee sold?
A) There would be a shortage of coffee.
B) The demand for coffee would increase.
C) The demand for coffee would decrease.
D) The supply curve would shift up vertically by $1.00.
Answer: D
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A firm is thinking of hiring an additional worker to their organization who they believe can increase total productivity by 100 units a week. The cost of hiring him or her is $1500 per week. If the price of each unit is $12,
a. the MR of hiring the worker is $1500
b. The MC of hiring the worker is $1200
c. The firm should not hire the worker since MB
When consumers and firms are driven by rational self-interest and they seek to maximize utility and profit respectively, then a parallel assumption would be that elected officials attempt to:
a. best serve the public interest. b. maximize hours worked. c. maximize their political support. d. fight for the oppressed and the disenfranchised, regardless of the political consequences.