Explain and Illustrate the Effect That an Increase in Industry

question 7

Essay

Explain and illustrate the effect that an increase in industry demand in a perfectly competitive industry will have on a firm within that industry in both the short run and long run.

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Definitions:

Tax Revenue

The wealth gathered by governments by imposing taxes.

Excise Tax

A tax levied on specific goods or commodities produced or sold within a country.

Incidence Of Tax

The analysis of who bears the ultimate burden of a tax, whether it be consumers, producers, or others.

Excise Tax

A tax levied on the sale or use of specific products or transactions, often included in the price of goods like gasoline, alcohol, and tobacco.