When a tax is imposed on the sellers of a good, the supply curve shifts
a. upward by the amount of the tax.
b. downward by the amount of the tax.
c. upward by less than the amount of the tax.
d. downward by less than the amount of the tax.
a
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Full-employment output is the level of output that firms in the economy supply when
A) taxes are zero. B) wages and prices have fully adjusted. C) the unemployment rate is zero. D) all capital is fully utilized.
Everything else equal, wages are likely to be higher when
a. the work is safer. b. more skill is required to perform well on the job. c. the work environment is more prestigious. d. the location of the job is more desirable.
The country is experiencing rapid inflation. What could the Fed do reduce the money supply and slow inflation?
a. buy government bonds b. lower the reserve ratio c. sell government bonds d. lower the discount rate
Suppose the government taxes a company that produces plastic water bottles and at the same time consumers become hesitant to use plastic water bottles due to the fear of toxins in the plastic. What would happen in the market to the equilibrium price and quantity of plastic water bottles?
A. Price increases and quantity is indeterminate. B. Quantity decreases and price is indeterminate. C. Quantity increases and price is indeterminate. D. Price decreases and quantity is indeterminate.