A tax imposed on the supplier of Blu Ray players shifts Sele

A tax imposed on the supplier of Blu Ray players shifts:

Select one:

a. the demand curve for Blu Ray players to the left.

b. the supply curve for Blu Ray players to the left.

c. the demand curve for Blu Ray players to the right.

d. the supply curve for Blu Ray players to the right.

Solution

If a tax is imposed on supplier of Blu Ray player ,supply curve for Blu Ray player shifts to the left by the amount of tax.

At a given price p and tax t, each seller obtains p – t, and thus supplies the amount associated with this net price. This is because at any lower price, the sellers would reduce the number of units offered. So supply curve shifts leftward.