Use the following information to answer the following questions.
The following graph depicts a market where a tax has been imposed.P e was the equilibrium price before the tax was imposed,and Q e was the equilibrium quantity.After the tax,P C is the price that consumers pay,and P S is the price that producers receive.Q T units are sold after the tax is imposed.NOTE: The areas B and C are rectangles that are divided by the supply curve S T .Include both sections of those rectangles when choosing your answers.

-Which areas represent consumer surplus before the tax is imposed?

Question

Use the following information to answer the following questions.
The following graph depicts a market where a tax has been imposed.P e was the equilibrium price before the tax was imposed,and Q e was the equilibrium quantity.After the tax,P C is the price that consumers pay,and P S is the price that producers receive.Q T units are sold after the tax is imposed.NOTE: The areas B and C are rectangles that are divided by the supply curve S T .Include both sections of those rectangles when choosing your answers.
 
-Which areas represent consumer surplus before the tax is imposed?

Quizplus · Accepted Answer

Consumer surplus before the tax is imposed is the area below the demand curve and above the price line. In this case, that area is A.

Use the Following Information to Answer the Following Questions