A tax on sellers has what effect on a market?
A. Supply shifts vertically upward by the amount of the tax.
B. Demand shifts vertically downward by the amount of the tax.
C. Equilibrium price decreases and equilibrium quantity decreases.
D. Equilibrium price decreases and equilibrium quantity increases.
A. Supply shifts vertically upward by the amount of the tax.
You might also like to view...
Suppose that Canada can produce 15 units of timber or 3 units of grain. Suppose that Mexico can produce 6 units of timber or 2 units of grain. Which of the following is CORRECT?
A) Mexico has a comparative advantage in grain production. B) Mexico has an absolute advantage in timber production. C) Canada has a comparative advantage in grain production. D) The countries would find trade mutually beneficial at a trading ratio of 1 grain for 2 timber.
A baker of chocolate chip cookies is likely to have a ______________ price elasticity of supply than does the seller of rare baseball cards due to ______________.
A. more elastic; the availability of inputs B. less elastic; the availability of inputs C. less elastic; a shorter adjustment time D. less elastic; a more flexible production process