1.2. Let's see if we can formulate any real laws about the economics of taxation. Which of the following must be true, as long as supply and demand curves have their normal shape

(i.e., they aren't perfectly vertical or horizontal, and demand curves have a negative slope while supply curves have a positive slope). More than one may be true.

If there is a tax:

a. The equilibrium quantity must fall, and the price that buyers pay must rise.

b. The equilibrium quantity must rise, and the price that sellers pay must rise.

c. The equilibrium quantity must fall, and the price that sellers receive must fall.

d. The equilibrium quantity must rise, and the price that buyers receive must fall.

(Note: The correct answer(s) to this question was(were) actually controversial until Nobel laureate Paul Samuelson created a simple math ematical proof in his legendary graduate text book, Foundations of Economic Analysis.)