After a tax is imposed,
A)consumers pay a higher price.
B)consumers lose consumer surplus.
C)producers lose producer surplus.
D)all of the above are true.

Question

After a tax is imposed,​
A)​consumers pay a higher price.
B)​consumers lose consumer surplus.
C)​producers lose producer surplus.
D)​all of the above are true.

Quizplus · Accepted Answer

All of the given options are true. When a tax is imposed, the price paid by the consumers increases, which leads to consumer surplus loss. Producers also lose producer surplus due to the reduction in the quantity demanded. Therefore, D is the correct choice.

After a Tax Is Imposed,​

After a Tax Is Imposed,