Asked by Alexia Keobangsy on Jun 16, 2024
Verified
A tax on a good causes the size of the market to shrink.
Market Size
The total volume or value of all sales within a given market over a specific period of time.
- Analyze the impact of taxes on market size and participant behavior.
Verified Answer
AS
Ankush SodhiJun 18, 2024
Final Answer :
True
Explanation :
A tax on a good generally increases the price buyers pay and decreases the price sellers receive, leading to a decrease in the quantity sold, thus shrinking the size of the market.
Learning Objectives
- Analyze the impact of taxes on market size and participant behavior.