how-does-a-4-tax-on-suppliers-affect-the-equilibrium-price-and-quantity-if-the-d

Question

How does a $4 tax on suppliers affect the equilibrium price and quantity if the demand equation is Qd = 40 - 4P and the supply equation is Qs = 2P - 8?

Accepted Answer

Equilibrium price increases, quantity decreases

Answer

Equilibrium price and quantity both increase

Answer

Equilibrium price and quantity both decrease

Answer

Equilibrium price decreases, quantity increases

How does a \$4 tax on suppliers affect the equilibrium price and quantity if the demand equation is Qd = 40 - 4P and the supply equation is Qs = 2P - 8?