Consider the Market for Peanut Butter

question 189

Multiple Choice

Consider the market for peanut butter.If there is an increase in the price of peanuts,

• A) there is an upward movement along the supply curve for peanut butter.
• B) the supply curve for peanuts shifts rightward.
• C) there is a decrease in the supply of peanuts.
• D) there is a decrease in the supply of peanut butter.
• E) there is a decrease in the demand for peanut butter.

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Definitions:

Per-Unit Tax

A tax imposed on a product based on the number of units purchased, not the value of the purchase.

Buyers

Individuals or entities that exchange money for goods and services.

Sellers

Individuals or entities that offer goods or services to buyers in exchange for payment.

Per-Unit Tax

A tax that is charged on each unit of a good or service that is sold.