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FIGURE 18-3 -Refer to Figure 18-3. Suppose That Supply Is Perfectly Elastic

Question 69

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FIGURE 18-3 -Refer to Figure 18-3. Suppose that supply is perfectly elastic and the price of this good is initially P3. If an excise tax raises the price from P3 to P4, the direct burden of the tax is A) the area P3AP4. B) the area P2BP3. C) the area P1CP4. D) the area BFC. E) zero. FIGURE 18-3
-Refer to Figure 18-3. Suppose that supply is perfectly elastic and the price of this good is initially P3. If an excise tax raises the price from P3 to P4, the direct burden of the tax is


A) the area P3AP4.
B) the area P2BP3.
C) the area P1CP4.
D) the area BFC.
E) zero.

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