If a New Unit Excise Tax Is Levied on Bottles

question 85

Multiple Choice

If a new unit excise tax is levied on bottles of soda, the

• A) demand for soda shifts to the left.
• B) demand for soda shifts to the right.
• C) supply of soda shifts to the right.
• D) supply of soda shifts to the left.

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Definitions:

Marginal Utility

The extra fulfillment or advantage a person gains by consuming an additional unit of a product or service.

Satisfaction

The feeling of pleasure or fulfillment that comes from achieving a goal or satisfying a need.

Marginal Utility

The increase in satisfaction or utility derived from the consumption of an additional unit of a good or service.