Suppose There Is Currently a Tax of $50 Per Ticket

question 43

Multiple Choice

Suppose there is currently a tax of $50 per ticket on airline tickets.Sellers of airline tickets are required to pay the tax to the government.If the tax is reduced from $50 per ticket to $30 per ticket,then the

• A)demand curve will shift upward by $20,and the effective price received by sellers will increase by $20.
• B)demand curve will shift upward by $20,and the effective price received by sellers will increase by less than $20.
• C)supply curve will shift downward by $20,and the price paid by buyers will decrease by $20.
• D)supply curve will shift downward by $20,and the price paid by buyers will decrease by less than $20.

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Definitions:

Vendor's Solicitor

A legal professional who represents the seller in a property transaction, responsible for the legal aspects of selling the property.

Monetary Damages

Compensation in the form of money awarded to a party in a lawsuit for loss or injury caused by the actions of another.

Rescind

To cancel, revoke, or repeal a contract, agreement, or resolution, often due to the discovery of some error or misrepresentation.

Purchase and Sale

The legal process of buying and selling goods or property, involving the transfer of ownership from the seller to the buyer.