Refer to the graph shown. Initially, the market is in equilibrium with price equal to $3 and quantity equal to 100. Government imposes a tax on suppliers of $1 per unit. The effect of the tax is to:
A) raise the price consumers pay from $3 to $4.
B) lower the price consumers pay from $3 to $2.
C) raise the price sellers keep after paying the tax.
D) lower the price sellers keep after paying the tax.

Question

Refer to the graph shown. Initially, the market is in equilibrium with price equal to $3 and quantity equal to 100. Government imposes a tax on suppliers of $1 per unit. The effect of the tax is to: 
A) raise the price consumers pay from $3 to $4. 
B) lower the price consumers pay from $3 to $2. 
C) raise the price sellers keep after paying the tax. 
D) lower the price sellers keep after paying the tax.

Quizplus · Accepted Answer

The Answer of Refer to the graph shown. Initially, the market is in equilibrium with price equal to $3 and quantity equal to 100. Government imposes a tax on suppliers of $1 per unit. The effect of the tax is to: 
A) raise the price consumers pay from $3 to $4. 
B) lower the price consumers pay from $3 to $2. 
C) raise the price sellers keep after paying the tax. 
D) lower the price sellers keep after paying the tax.

Refer to the Graph Shown