A tax imposed on the sellers of a good

Name: A tax imposed on the sellers of a good
Brand: Quizplus
Rating: 4.8 (53 reviews)

Question

Quizplus · Accepted Answer

When a tax is imposed on the sellers of a good, it increases the cost of production for them. This, in turn, causes the supply curve to shift leftward, resulting in a higher equilibrium price and a lower equilibrium quantity. Consequently, the price that buyers pay increases, but the effective price received by the seller decreases. Thus, the tax raises the price buyers pay and lowers the effective price for sellers.

A Tax Imposed on the Sellers of a Good