Suppose there is currently a tax of $50 per ticket on airline tickets. Sellers of airline tickets are required to pay the tax to the government. If the tax is reduced from $50 per ticket to $30 per ticket, then thea. demand curve will shift upward by $20, and the price paid by buyers will decrease by less than $20.b. demand curve will shift upward by $20, and the price paid by buyers will decrease by $20.c. supply curve will shift downward by $20, and the effective price received by sellers will increase by less than $20.d. supply curve will shift downward by $20, and the effective price received by sellers will increase by $20.

Respuesta :

Answer:

the demand curve will shift upward by $20 and the price paid by buyers will decrease by $20.

Step-by-step explanation:

the reduction in the fixed amount of tax from $50 t0 $30 will bring about reduction  of $20 in the price of ticket. the reduction in the price of the ticket, other factors held constant, will brings about change in the demand curve.

The correct answer is D, as supply curve will shift downward by $20, and the effective price received by sellers will increase by $20.

This is so because by reducing the tax, the value that each airline will effectively increase. In this way, as they obtain greater income for each ticket, the airlines will in turn increase the offer of tickets.

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