Given the supply and demand curves shown in the figure below, a $1 tax on sales should be expected to cause:
A)price to increase by $1 with quantity unchanged.
B)quantity to fall with price left unchanged.
C)no change in either price or quantity.
D)price to rise and quantity to fall.
E)quantity to increase with price left unchanged.

Question

Given the supply and demand curves shown in the figure below, a $1 tax on sales should be expected to cause: 
A)price to increase by $1 with quantity unchanged. 
B)quantity to fall with price left unchanged. 
C)no change in either price or quantity. 
D)price to rise and quantity to fall. 
E)quantity to increase with price left unchanged.

Quizplus · Accepted Answer

The Answer of Given the supply and demand curves shown in the figure below, a $1 tax on sales should be expected to cause: 
A)price to increase by $1 with quantity unchanged. 
B)quantity to fall with price left unchanged. 
C)no change in either price or quantity. 
D)price to rise and quantity to fall. 
E)quantity to increase with price left unchanged.

Given the Supply and Demand Curves Shown in the Figure