Excise Tax Shifts Supply Curve Upward Steps: - Identify the tax type: A specific indirect tax of $1perunitisanexcisetaxtypicallyimposedonproducers,increasingtheirmarginalcost\mathrm{.}-Analyzeimpactonsupply:Highercostsmeanproducerssupplyless$1, as it increases the minimum price needed to supply each quantity (standard microeconomic model of tax incidence). Why the others are wrong: - A: Demand shifts down only if the tax is directly on buyers, not producers; upward demand shift never occurs with taxes. - B: Downward supply shift would imply a subsidy, not a tax. - D: Demand shifts up with increased willingness to pay, unrelated to taxes; …