A tax on the sellers of popcorn will cause the price the buyers pay:

Question

Quizplus · Accepted Answer

When a tax is imposed on the sellers of popcorn, the cost of producing popcorn increases for the sellers. As a result, in order to maintain their profit margin, the sellers increase the price of popcorn which is paid by the buyers. Thus, the price paid by the buyers increases. However, the effective price received by the sellers falls because they have to pay part of their revenue as tax to the government. Therefore, option C is the correct choice.

A Tax on the Sellers of Popcorn Will Cause the Price