The Imposition of an Excise Tax Usually Causes the Price

question 11

Multiple Choice

The imposition of an excise tax usually causes the price paid by consumers to , while the price received by sellers .

• A) fall; remains unchanged
• B) rise; falls
• C) rise; rises
• D) rise; remains unchanged
• E) fall; falls

---

Definitions:

Terminal Value

The estimated value of a business or project at the end of a specific period, taking into account future cash flows in perpetuity.

Net Income

The total profit of a company after all expenses and taxes have been subtracted from total revenue.

P/E Ratio

The Price-to-Earnings Ratio is a financial metric comparing a company's share price to its earnings per share, indicating the value that investors place on a company's earning ability.

Cram-Down Round

A financing event where existing shareholders see their stakes diluted due to new, often unfavorable funding accepted to prevent company failure.