An unintended effect of a new tax placed on the producers of good A may include

Question

Quizplus · Accepted Answer

A new tax on the producers of good A will increase the cost of production, resulting in an increase in the price of good A (choice A). This could also result in a decrease in demand for good A, causing a reduction in consumers' surplus for the buyers of good A (choice B). Additionally, if the tax results in a significant decrease in demand for good A, producers may end up employing fewer workers in the production of good A (choice C). Therefore, all of the options mentioned in the question, i.e., A, B, and C, are valid unintended effects.

An Unintended Effect of a New Tax Placed on the Producers