Use the following to answer questions:
Figure: Tax on Buyers 2
-(Figure: Tax on Buyers 2) In the diagram, the size of the tax is:
A) $1.00.
B) $2.00.
C) $3.00.
D) $4.00.

Question

Use the following to answer questions:
Figure: Tax on Buyers 2 
-(Figure: Tax on Buyers 2) In the diagram, the size of the tax is:
A) $1.00. 
B) $2.00. 
C) $3.00. 
D) $4.00.

Quizplus · Accepted Answer

The size of the tax is represented by the vertical distance between the two demand curves. In this case, the distance between D1 and D2 is $2.00, which means that the size of the tax is $2.00.

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