If There Was an Increase in the Excise Tax Imposed

question 270

Multiple Choice

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

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

---

Definitions:

Horizontal Merger

The merger into a single firm of two firms producing the same product and selling it in the same geographic market.

Clayton Act

A U.S. antitrust law passed in 1914, aimed at increasing economic competition and preventing monopolies by prohibiting specific types of conduct that could harm competitors.

Antitrust Laws

Legislation aimed at promoting competition within markets by regulating anti-competitive practices, monopolies, and mergers that could restrict trade.

Structuralists

Theorists who believe that human culture and society are heavily influenced by underlying structures, often in fields such as anthropology, sociology, and linguistics.