If the District of Columbia decided to tax coffee at $1/cup what would happen to the price of a cup of coffee in Washington, D.C.?

Question

Quizplus · Accepted Answer

If the District of Columbia decided to tax coffee at $1/cup, the price of a cup of coffee in Washington, D.C. would likely go up by nearly $1. This is because coffee shops and retailers would need to cover the cost of the tax, and would likely pass that cost onto the consumer by raising the price of a cup of coffee. It is unlikely that the price would go down, as the tax would add an extra cost that would need to be covered by someone.

If the District of Columbia Decided to Tax Coffee at $1/cup