Refer to the information provided in Figure 4.1 below to answer the question(s) that follow. Figure 4.1
-Refer to Figure 4.1. Assume that initially there is free trade. If the United States then imposes a 10-cent tax per apple,
A) the quantity of apples demanded will be reduced by 4 million apples per day.
B) the quantity of apples supplied by U.S. firms will increase by 6 million apples per day.
C) the price of apples in the United States will increase to 40 cents per apple.
D) U.S. imports of apples will increase by 6 million per day.

Question

Refer to the information provided in Figure 4.1 below to answer the question(s) that follow.  Figure 4.1
-Refer to Figure 4.1. Assume that initially there is free trade. If the United States then imposes a 10-cent tax per apple,
A) the quantity of apples demanded will be reduced by 4 million apples per day. 
B) the quantity of apples supplied by U.S. firms will increase by 6 million apples per day. 
C) the price of apples in the United States will increase to 40 cents per apple. 
D) U.S. imports of apples will increase by 6 million per day.

Quizplus · Accepted Answer

The tax will increase the price of apples in the United States, making them more expensive for consumers. As a result, the quantity of apples demanded will decrease.

Refer to the Information Provided in Figure 4