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:

Hair Replacement

A set of medical or cosmetic techniques aimed at restoring hair to balding or thinning areas of the scalp.

Equilibrium Quantity

The quantity of goods or services supplied and demanded at the equilibrium price, where the quantity demanded equals the quantity supplied.

Tariffs

Taxes imposed by a government on imported goods, often to protect domestic industries from foreign competition.

Lumber

Wood that has been converted into planks and beams, which is part of the sequence of processes involved in the production of wood.