If Higher Taxes Raise the Unit Cost of a Competitive

question 79

Multiple Choice

If higher taxes raise the unit cost of a competitive industry, then producers

• A)decrease production in the short run and the number of producers decreases in the long run.
• B)decrease production in the short run and the number of producers increases in the long run.
• C)increase production in the short run and the number of producers decreases in the long run.
• D)increase production in the short run and the number of producers increases in the long run.
• E)keep production constant in the short run and the number of producers remains the same in the long run.

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Definitions:

Replanting

The action of planting plants or seeds in the ground again, often to regenerate an area of forest or to grow a new crop.

Carbon-containing Gases

Gases that include carbon atoms in their molecules, such as carbon dioxide and methane, often impacting the greenhouse effect.

Deforested Areas

Regions where forests have been cleared or removed, often resulting in habitat loss and biodiversity decline.

Sclerenchyma

A type of plant tissue known for its thick, rigid cell walls and function in providing support and strength.