A tax on golf clubs will cause buyers of golf clubs to pay a higher price, sellers of golf clubs to receive a lower price, and fewer golf clubs to be sold.

Question

Quizplus · Accepted Answer

A tax on golf clubs effectively increases the cost of production for sellers, leading to a higher market price for buyers. This higher price reduces the quantity demanded, resulting in fewer sales. Sellers receive a lower price net of tax, reducing their incentive to sell.

A Tax on Golf Clubs Will Cause Buyers of Golf