The study of who bears the burden of taxation is called tax incidence. The effects of taxation on market can be summarized like this: Firstly, a tax creates a wedge between the price that buyers pay and the price that sellers receive. The wedge is equal to the tax. Secondly, regardless of whether the tax is levied on buyers or sellers, the effects of taxation are the same: the price that the buyers pay rises and the price that the sellers receive falls. Finally, the tax also reduces the market size by reducing the equilibrium quantity. The correct answer is B.