Graph 8-3

-According to Graph 8-3, the reduction in producer surplus caused by the tax is:

Question

Graph 8-3
 
-According to Graph 8-3, the reduction in producer surplus caused by the tax is:

Quizplus · Accepted Answer

In Graph 8-3, the producer surplus without the tax is represented by triangle P, Q, S, whereas with the tax, it is represented by triangle P, Q, R. The difference in area between the two triangles is $800, which represents the reduction in producer surplus caused by the tax. Therefore, the correct answer is option B) $800.

Graph 8-3 -According to Graph 8-3, the Reduction in Producer Surplus Caused