Figure 8-6

-Refer to Figure 8-6.As a result of the tax,
A)buyers effectively pay $16 for each unit of the good and sellers effectively receive $12 for each unit of the good.
B)buyers effectively pay $16 for each unit of the good and sellers effectively receive $8 for each unit of the good.
C)buyers effectively pay $12 for each unit of the good and sellers effectively receive $8 for each unit of the good.
D)buyers effectively pay $14 for each unit of the good and sellers effectively receive $10 for each unit of the good.

Question

Figure 8-6
 
-Refer to Figure 8-6.As a result of the tax,
A)buyers effectively pay $16 for each unit of the good and sellers effectively receive $12 for each unit of the good. 
B)buyers effectively pay $16 for each unit of the good and sellers effectively receive $8 for each unit of the good. 
C)buyers effectively pay $12 for each unit of the good and sellers effectively receive $8 for each unit of the good. 
D)buyers effectively pay $14 for each unit of the good and sellers effectively receive $10 for each unit of the good.

Quizplus · Accepted Answer

The tax creates a wedge between what buyers pay and what sellers receive. If buyers pay $16 and sellers receive $8, the difference is the tax amount.

Figure 8-6 -Refer to Figure 8-6.As a Result of the Tax