What is the effect on the supply curve for skateboards if the government implements a tax on the manufacturing process?

Question

Business

Kevin Larson

14 November, 01:56

What is the effect on the supply curve for skateboards if the government implements a tax on the manufacturing process?

+1

Answers (1)

Know the Answer?

Alessandra Gates · Answer 1

The supply of the skate boards will decrease with the imposition of taxes.

Explanation:

With the imposition of taxes on the skateboards by the government, it will increase the cost of production of the good. his will increase the price of goods.

At a particular level of demand, the supply curve will shift left wards which means that the supply of the skate boards will decrease to maintain equilibrium in the market again at that level of demand only.