Figure 8-9
The vertical distance between points A and C represents a tax in the market.
-Refer to Figure 8-9.The equilibrium price and quantity before the imposition of the tax is
A)P=$800 and Q=20.
B)P=$600 and Q=20.
C)P=$300 and Q=20.
D)P=$600 and Q=40.

Question

Figure 8-9
The vertical distance between points A and C represents a tax in the market. 
-Refer to Figure 8-9.The equilibrium price and quantity before the imposition of the tax is
A)P=$800 and Q=20. 
B)P=$600 and Q=20. 
C)P=$300 and Q=20. 
D)P=$600 and Q=40.

Quizplus · Accepted Answer

The equilibrium price and quantity are determined where the supply and demand curves intersect. In this case, the intersection occurs at a price of $600 and a quantity of 40.

Figure 8-9 the Vertical Distance Between Points a and C Represents a Represents