Post Utme Pan Atlantic University 2023 Economics Question 29

Practice objective / multiple choice question 29 from the 2023 Post Utme Pan Atlantic University Economics examination.

Post Utme Pan Atlantic University 2023 Economics Objective / Multiple Choice
Question 29 POST_UTME_PAN-ATLANTIC_UNIVERSITY • 2023 • ECONOMICS • objective

A government is considering impo\sing a tax on a particular good to reduce its consumption. However, the tax also leads to a decrease in the quantity of the good produced. U\sing the concept of supply and demand, explain why the tax may not be effective in reducing the consumption of the good.

Answer Options

A. The tax increases the supply of the good, leading to an increase in consumption.
Correct Answer B. The tax decreases the demand for the good, leading to a decrease in consumption.
C. The tax has no effect on the supply and demand of the good.
D. The tax increases the demand for the good, leading to an increase in consumption.
Correct Answer
B
Correct Option:
The tax decreases the demand for the good, leading to a decrease in consumption.

About This Question

This is Post Utme Pan Atlantic University 2023 Economics Question 29. It is one of the objective questions from the 2023 Post Utme Pan Atlantic University Economics examination.

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