If the government imposes a $5 excise tax on the production of wine, then fromthe perspective of wine consumers, the "effective" or after-tax supply curve forwine wil shiftdown vertically by more than $5Mp verticaly by exactly SSdown vertically by exoctly $5dwn vertically hv less than $atly Inv less then 15left herleaty

Consider a liner supply function P=a+bQ .... (1)

If the government imposes a $5 excise tax on the production of wine, then from the perspective of wine consumers, the "effective" or after-tax supply curve for wine will shift down verticaly by more than $5 Mp vertically by exactly 5S down vertically by exoctly $5

If the government imposes a $5 excise tax on the production of wine, then from the perspective of wine consumers, the "effective" or after-tax supply curve for wine will shift down verticaly by more than $5 Mp vertically by exactly 5S down vertically by exoctly $5

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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