Post Utme Eksu 2019 Economics Question 16

Practice objective / multiple choice question 16 from the 2019 Post Utme Eksu Economics examination.

Post Utme Eksu 2019 Economics Objective / Multiple Choice
Question 16 POST_UTME_EKSU • 2019 • ECONOMICS • objective

The government of Nigeria plans to increase the tax rate on luxury goods to reduce the budget deficit. Assuming the demand curve for luxury goods is downward sloping and the supply curve is upward sloping, what will be the effect on the equilibrium price and quantity of luxury goods?

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 Eksu 2019 Economics Question 16. It is one of the objective questions from the 2019 Post Utme Eksu Economics examination.

View More Post Utme Eksu 2019 Economics Questions More Post Utme Eksu Practice Questions Back to Questions

Master the Exam!

You've seen a preview, but there are thousands more questions plus AI tutor to break down complex solutions.

Unlock Full Access Available for Android & Windows
Chat with Support