If There Was an Increase in the Excise Tax Imposed

question 288

Multiple Choice

If there was an increase in the excise tax imposed on beer suppliers, what would be the effect on the equilibrium price and quantity of beer?

• A) price increases; quantity decreases
• B) price decreases; quantity decreases
• C) price increases; quantity increases
• D) price decreases; quantity increases

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Definitions:

Goodwill

An intangible asset on a company's balance sheet that represents the premium paid over the fair market value of the acquired assets in a business acquisition.

Tangible Capital

Physical assets that are used in the operating activities of a business, such as buildings, machinery, and equipment.

Economic System

The organized way a country allocates resources and distributes goods and services in the national community.

Future Goods

Goods that are not yet produced or are not currently available but will be in the future.