Figure: Model of a Competitive Market

question 120

Multiple Choice

Figure: Model of a Competitive Market
(Figure: Model of a Competitive Market) Given the figure Model of a Competitive Market, if there are external costs, a tax imposed on sellers will:

• A)decrease the equilibrium quantity.
• B)increase the equilibrium quantity.
• C)have no effect on the equilibrium price.
• D)decrease the equilibrium price.

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