An emission fee levied against polluting firms will tend to shift the
A)supply curve of the firms to the left.
B)supply curve of the firms to the right.
C)demand curve for the product to the left.
D)demand curve for the product to the right.

Question

Quizplus · Accepted Answer

An emission fee increases the cost of production for polluting firms, making it more expensive for them to produce goods. This results in a decrease in the quantity supplied at each price point, effectively shifting the supply curve to the left.

An Emission Fee Levied Against Polluting Firms Will Tend to Shift