Since demanders of a good are concerned with the total price they have to pay for a good,a unit tax on the good will _____.
A)shift the supply curve downward by the entire amount of the tax
B)shift the supply curve upward by the entire amount of the tax
C)shift the demand curve downward by the entire amount of the tax
D)shift the demand curve upward by the entire amount of the tax

Question

Quizplus · Accepted Answer

Demanders are concerned with the total price they pay for a good, so a unit tax on the good will increase the price of the good for the demanders by the amount of the tax. This will decrease the quantity demanded of the good, which is represented by a downward shift in the demand curve.

Since Demanders of a Good Are Concerned with the Total