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What Will a Tax Placed on Coffee Do to the Equilibrium

Question 119

Multiple Choice

What will a tax placed on coffee do to the equilibrium price and quantity


A) It will reduce the equilibrium price of coffee and increase the equilibrium quantity.
B) It will increase the equilibrium price of coffee and reduce the equilibrium quantity.
C) It will increase the equilibrium price of coffee and increase the equilibrium quantity.
D) It will reduce the equilibrium price of coffee and reduce the equilibrium quantity.

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