A corrective tax
A)can be used to internalize a negative externality.
B)imposed on sellers shifts the supply curve to the left.
C)imposed on buyers shifts the demand curve to the left.
D)All of the above are correct.

Question

Quizplus · Accepted Answer

A corrective tax can be used to internalize a negative externality by shifting the supply curve to the left or the demand curve to the left, depending on whether it is imposed on sellers or buyers.

A Corrective Tax