"This manufacturer has no idea yet how much the carbon tax will impact his business. How could he have possibly done any calculations .. which of his inputs would be affected?"
How could he have done ANY calculations?! Perhaps he doesn't need to do any more! Quite likely he already knows that the business is so close to the bone after dealing with current cost conditions and exchange rate pressures (like so many businesses in Australia at the moment) and simply knows that ANY further increase in costs making operating conditions harder, compared to competitors, is going to seal his fate.
