Use the following to answer question:
-(Figure: The Market for SUVs)Use Figure: The Market for SUVs.If the government imposes a $30,000 tax on SUVs and collects it from the SUV suppliers,the _____ curve will shift _____ by _____.

Question

Use the following to answer question: 
-(Figure: The Market for SUVs)Use Figure: The Market for SUVs.If the government imposes a $30,000 tax on SUVs and collects it from the SUV suppliers,the _____ curve will shift _____ by _____.

Quizplus · Accepted Answer

A tax on SUVs would increase the cost of production for the SUV suppliers, causing the supply curve to shift upward. The amount of the tax is $30,000, which is the magnitude of the upward shift. The demand curve would not shift in response to the tax.

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