A tax on sellers:

Name: A tax on sellers:
Brand: Quizplus
Rating: 5.0 (39 reviews)

Question

A tax on sellers:

Quizplus · Accepted Answer

A tax on sellers increases the cost of producing and selling the product. This leads to higher prices as sellers will need to cover the cost of the tax. Therefore, the supply curve shifts vertically upwards by the amount of the tax. However, the demand remains the same, so the demand curve does not shift. This results in a new equilibrium with a higher price and lower quantity.

A Tax on Sellers