Figure 8-7
The vertical distance between points A and B represents a tax in the market.

-Refer to Figure 8-7.As a result of the tax,
A) consumer surplus decreases from $150 to $60.
B) producer surplus decreases from $125 to $45.
C) the market experiences a deadweight loss of $45.
D) All of the above are correct.

Question

Figure 8-7
The vertical distance between points A and B represents a tax in the market.
 
-Refer to Figure 8-7.As a result of the tax,
A) consumer surplus decreases from $150 to $60. 
B) producer surplus decreases from $125 to $45. 
C) the market experiences a deadweight loss of $45. 
D) All of the above are correct.

Quizplus · Accepted Answer

The Answer of Figure 8-7
The vertical distance between points A and B represents a tax in the market.
 
-Refer to Figure 8-7.As a result of the tax,
A) consumer surplus decreases from $150 to $60. 
B) producer surplus decreases from $125 to $45. 
C) the market experiences a deadweight loss of $45. 
D) All of the above are correct.

Figure 8-7 the Vertical Distance Between Points a and B Represents a Represents