Adalyn Carney

Business

25 July, 20:06

Suppose the government imposes a $10 excise tax on the sale of sweaters by charging suppliers $10 for each sweater sold. If the demand curve for sweaters is downward sloping, we would predict that:

a. the price of sweaters will increase by less than $10. Selected:

b. the price of sweaters will increase by $10. This answer is incorrect.

c. the price of sweaters will decrease by $10.

d. consumers of sweaters will bear the entire burden of the tax.

e. the quantity of sweaters purchased will increase.