If a Good Has a Tax Levied on It,sellers Respond

question 167

Multiple Choice

If a good has a tax levied on it,sellers respond to the price that excludes the tax and not the price with the tax because

• A) the tax is handed over to the state directly by buyers.
• B) sellers do not get to keep the tax revenue.
• C) the demand for the good has decreased.
• D) the quantity supplied of the good increases.
• E) demanders pay none of the tax.

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Definitions:

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