Assume the law of demand and the law of supply both apply to the market for cars.If the government imposed a $500 tax per car on buyers of cars,then the price received by sellers of cars would

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The $500 tax imposed on buyers would shift the demand curve to the left, leading to a decrease in the quantity demanded of cars, which would put downward pressure on the price of cars. However, because the law of supply states that as the price of a good increases, the quantity supplied also increases, the price received by sellers of cars would decrease by less than $500. The final amount of the decrease in price would depend on the elasticities of demand and supply.

Assume the Law of Demand and the Law of Supply