The basic effect of a tax on a service is to _____ that service.
A)decrease the supply of
B)increase the supply of
C)decrease the demand for
D)increase the demand for

Question

Quizplus · Accepted Answer

A tax on a service increases the cost of providing that service, which typically leads to a decrease in the supply of that service as providers may reduce the quantity offered at the original price.

The Basic Effect of a Tax on a Service Is