We can show the impact of a per-unit tax on tickets in MLB as a:
A) Rightward shift of the demand curve.
B) Increase in fixed costs.
C) Leftward shift of the supply curve.
D) Rightward shift of the supply curve.

Question

Quizplus · Accepted Answer

A per-unit tax on tickets would increase the cost of production for MLB teams, resulting in a leftward shift of the supply curve. The quantity supplied would decrease while the price for tickets would increase for consumers, as the tax is passed on to them. This would not affect demand, so option A and B are incorrect. Option D is also incorrect because a supply shift is required to show the impact of the tax.

We Can Show the Impact of a Per-Unit Tax on Tickets