Use the following to answer question:
-(Figure: The Market for Lattes)Use Figure: The Market for Lattes.If the government assesses a tax of $0.75 on each latte,the price the consumer pays for a latte after the tax will:

Question

Use the following to answer question: 
-(Figure: The Market for Lattes)Use Figure: The Market for Lattes.If the government assesses a tax of $0.75 on each latte,the price the consumer pays for a latte after the tax will:

Quizplus · Accepted Answer

The price the consumer pays for a latte after the tax increases by the amount of the tax, assuming the entire tax is passed on to the consumer. Since the original price is not specified in the question, we infer from the options that it was $2. Adding a $0.75 tax to this price results in a new price of $2.75. However, the correct interpretation is that the final price paid by the consumer increases to $2.75, but the increase from the original price is $0.75, making the correct answer reflect the increase to $2.75, not the increase by $0.75 from $2. The explanation seems to have an error in reasoning based on the provided options and the correct answer's rationale. The correct explanation should focus on the impact of the tax on the final price paid by consumers, considering the initial conditions or details provided in the question or figure, which are not visible in this format.

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