How does an increase in the excise tax rate affect the market price and the quantity exchanged?
Dear Student,
Increase in the excise tax rate , there will be decrease in the both demand and supply . Both the curves will shift leftwards and this will lead to no effect on the price but increase in the equilibrium quantity.
Regards,
Increase in the excise tax rate , there will be decrease in the both demand and supply . Both the curves will shift leftwards and this will lead to no effect on the price but increase in the equilibrium quantity.
Regards,