If a Tax Is Placed on Perfectly Competitive Firms That

question 129

Multiple Choice

If a tax is placed on perfectly competitive firms that impose external costs on society, the firm's marginal cost curve will shift ________ and the industry supply curve will shift to the ________.

• A) down; left
• B) down; right
• C) up; right
• D) up; left

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Definitions:

Internal Control System

Procedures and policies set by an enterprise to preserve the correctness of its financial and bookkeeping details, advance accountability, and obstruct malicious acts.

Financial Records

Documented information of a business's operations, including income, expenses, assets, and liabilities, used to track financial performance.

Bank Statement

A document or report issued by a bank summarizing transactions in an account holder's account over a specific period.

Deposits

Funds placed into a bank account or towards the purchase of an asset, representing a liability for the bank or a commitment by the buyer.