Post Utme Christopher University 2020 Economics Question 21

Practice objective / multiple choice question 21 from the 2020 Post Utme Christopher University Economics examination.

Post Utme Christopher University 2020 Economics Objective / Multiple Choice
Question 21 POST_UTME_CHRISTOPHER_UNIVERSITY • 2020 • ECONOMICS • objective

A government imposes a tax on a commodity to reduce its consumption. If the demand curve for the commodity is downward sloping and the tax is levied on the consumer, what will be the effect on the equilibrium price and quantity of the commodity?

Answer Options

Correct Answer A. The equilibrium price will increase, and the equilibrium quantity will decrease.
B. The equilibrium price will decrease, and the equilibrium quantity will increase.
C. The equilibrium price will remain unchanged, and the equilibrium quantity will decrease.
D. The equilibrium price will increase, and the equilibrium quantity will increase.
Correct Answer
A
Correct Option:
The equilibrium price will increase, and the equilibrium quantity will decrease.

About This Question

This is Post Utme Christopher University 2020 Economics Question 21. It is one of the objective questions from the 2020 Post Utme Christopher University Economics examination.

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