If a Tax Is Placed on Perfectly Competitive Firms That

question 129

Multiple Choice

If a tax is placed on perfectly competitive firms that impose external costs on society, the firm's marginal cost curve will shift ________ and the industry supply curve will shift to the ________.

• A) down; left
• B) down; right
• C) up; right
• D) up; left

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Definitions:

Economic Interest Groups

Organizations that seek to influence public policy in favor of specific economic interests and benefits of their members.

Public Interest Groups

Organizations that aim to influence public policy in favor of the common good or a specific public interest rather than the interests of a particular group.

Direct Techniques

Strategies or methods applied in a straightforward and immediate manner to achieve a particular result, often used in the context of communication, marketing, or therapeutic interventions.

Interest Groups

Organizations or groups of individuals who share common interests or goals and seek to influence public policy and decision-making processes.