After an Excise Tax Is Imposed on a Good or Service

question 32

Multiple Choice

After an excise tax is imposed on a good or service,

• A) the equilibrium price and quantity are unchanged
• B) firms must charge a higher price for any particular quantity
• C) firms must charge a lower price for any particular quantity
• D) the equilibrium price and quantity will both increase
• E) the equilibrium price and quantity will both decrease

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Definitions:

Repeated Exposure

A process by which individuals become more familiar with a stimulus (e.g., sound, image) through repeated contact, leading to a change in response.

Angular Gyrus

A region of the brain located in the parietal lobe, implicated in processes related to language, number processing, and spatial cognition.

Visual Information

Data perceived through the eyes, processed by the visual system, and used to inform subsequent behavior or cognition.

Auditory Information

Refers to data that is received and processed through the sense of hearing, including sounds, speech, and music.