Refer to the graph shown. Assume that the market is initially in equilibrium at a price of $10 and a quantity of 500 units. If the government imposes a $4 per-unit tax on this product, equilibrium quantity will change to:
A) 300.
B) 400.
C) 500.
D) 1,000.

Question

Refer to the graph shown. Assume that the market is initially in equilibrium at a price of $10 and a quantity of 500 units. If the government imposes a $4 per-unit tax on this product, equilibrium quantity will change to: 
A) 300. 
B) 400. 
C) 500. 
D) 1,000.

Quizplus · Accepted Answer

The Answer of Refer to the graph shown. Assume that the market is initially in equilibrium at a price of $10 and a quantity of 500 units. If the government imposes a $4 per-unit tax on this product, equilibrium quantity will change to: 
A) 300. 
B) 400. 
C) 500. 
D) 1,000.

Refer to the Graph Shown