If the government institutes a tax on suppliers of Cheesy-Poofs, the market for Cheesy-Poofs will see:

Question

Quizplus · Accepted Answer

The tax on suppliers of Cheesy-Poofs will increase their costs, which will result in a decrease in supply. The higher cost to produce Cheesy-Poofs will also result in a higher price for consumers, leading to a decrease in quantity demanded. Therefore, there will be a decrease in supply, a decrease in quantity demanded, and an increase in price.

If the Government Institutes a Tax on Suppliers of Cheesy-Poofs