What Effect Would an Excise Tax on Gasoline Have on the Market

question 34

Multiple Choice

What effect would an excise tax on gasoline have on the market for gasoline?

• A) The quantity supplied would fall, and the quantity demanded would rise.
• B) The after-tax price of gasoline would fall as sellers lower prices to compensate buyers.
• C) The demand curve for gasoline would shift to the right.
• D) The after-tax price received by the seller would be lower than the price before the tax.

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