Exhibit 19-8

-Refer to Exhibit 19-8. The market for good X is initially at point A. A tax is then placed on the production of good X. It follows that the tax is equal to
A)$1 per unit.
B)$2 per unit.
C)$12 in total.
D)$10 in total.
E)none of the above

Question

Exhibit 19-8
​
 
-Refer to Exhibit 19-8. The market for good X is initially at point A. A tax is then placed on the production of good X. It follows that the tax is equal to
A)$1 per unit. 
B)$2 per unit. 
C)$12 in total. 
D)$10 in total. 
E)none of the above

Quizplus · Accepted Answer

The tax is equal to $2 per unit, as this is the difference between the initial equilibrium price and the new price after the tax is imposed.

Exhibit 19-8 ​

Exhibit 19-8