Question

if congress decides to reduce the tax per pack paid by sellers of cigarettes, other things being equal, the price of cigarettes will fall. this fall in prices can be attributed to a(n): a. rightward shift of the supply curve for cigarettes. b. downward movement along the demand curve for cigarettes. c. upward movement along the supply curve for cigarettes. d. leftward shift of the supply curve for cigarettes.

Explanation:

A tax reduction on sellers lowers their production costs, making them willing to supply more cigarettes at every price level. This causes the entire supply curve to shift right. The new equilibrium from this shift results in a lower market price. Movements along curves are caused by price changes, not cost/tax factors that shift the curve itself.

Answer:

a. rightward shift of the supply curve for cigarettes.