Suppose a Market Is in Equilibrium at Price P₀,and Then

question 143

Multiple Choice

Suppose a market is in equilibrium at price P₀,and then an excise tax of t dollars per unit of the good is imposed.At a price of (P₀ + t) there will be excess ________ for the good unless the demand curve is ________.

• A)supply; horizontal
• B)supply; vertical
• C)demand; horizontal
• D)demand; vertical
• E)tax; unit elastic

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