The effects of a per-unit tax imposed on sales of an industry's product would likely include
A) a lower product price at any amount of the product supplied.
B) a leftward shift of the market supply curve for the product.
C) a leftward movement along the market supply curve for the product.
D) none of the above.

Question

Quizplus · Accepted Answer

A per-unit tax on sales increases the cost of supplying each unit of the product, which effectively decreases the quantity supplied at any given price. This is represented by a leftward shift of the market supply curve, as it now costs more to supply the same quantity of the product.

The Effects of a Per-Unit Tax Imposed on Sales of an Industry's