Figure 8-7
The vertical distance between points A and B represents a tax in the market.
-Refer to Figure 8-7.Which of the following statements is correct?
A)Total surplus before the tax is imposed is $500.
B)After the tax is imposed,consumer surplus is 45 percent of its pre-tax value.
C)After the tax is imposed,producer surplus is 45 percent of its pre-tax value.
D)All of the above are correct.

Question

Figure 8-7
The vertical distance between points A and B represents a tax in the market. 
-Refer to Figure 8-7.Which of the following statements is correct?
A)Total surplus before the tax is imposed is $500. 
B)After the tax is imposed,consumer surplus is 45 percent of its pre-tax value. 
C)After the tax is imposed,producer surplus is 45 percent of its pre-tax value. 
D)All of the above are correct.

Quizplus · Accepted Answer

The Answer of Figure 8-7
The vertical distance between points A and B represents a tax in the market. 
-Refer to Figure 8-7.Which of the following statements is correct?
A)Total surplus before the tax is imposed is $500. 
B)After the tax is imposed,consumer surplus is 45 percent of its pre-tax value. 
C)After the tax is imposed,producer surplus is 45 percent of its pre-tax value. 
D)All of the above are correct.

Figure 8-7 the Vertical Distance Between Points a and B Represents a Represents