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If an Excise Tax Is Imposed on Automobiles and Collected

Question 3

Multiple Choice

If an excise tax is imposed on automobiles and collected from consumers,the:


A) demand curve will shift downward by the amount of the tax.
B) supply curve will shift upward by the amount of the tax.
C) equilibrium quantity supplied will increase relative to the pretax level.
D) equilibrium quantity demanded will increase relative to the pretax level.

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