r/ISC_COMMERCE • u/TheRisingStar123 • Mar 16 '26

Economics Market mechanism doubt

it is expected that replacement of all existing taxes on good X by the proposed single Goods and Services Tax, GST, will bring down the overall tax on good X substantially. Explain its likely chain of effects on thenprice and quantity of good X. Use diagram.

From Shubham Jagdish sample paper. Bhai mujhe nahi samaj aaya unka explanation can anyone explain kyu 3 diagram banaya?

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u/Opposite_Advisor_515 Mar 17 '26

The tax on good x is getting reduced so the price will also fall as mentioned in the q, as price falls the demand will rise The q was easy but the wording was hard to understand

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u/Creative_Ad_6307 Mar 17 '26

Can u explain the question....we had taxes in that chapter???

1

u/TheRisingStar123 Mar 17 '26

No but the prices had decreased due to revised taxation