Figure 8-2
The vertical distance between points C and D represents a tax in the market.

-Refer to Figure 8-2. The loss of consumer surplus associated with some buyers dropping out of the market as a result of the tax is
A)$4.
B)$6.
C)$12.
D)$8.

Question

Figure 8-2
The vertical distance between points C and D represents a tax in the market.
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-Refer to Figure 8-2. The loss of consumer surplus associated with some buyers dropping out of the market as a result of the tax is
A)$4. 
B)$6. 
C)$12. 
D)$8.

Quizplus · Accepted Answer

The loss of consumer surplus associated with some buyers dropping out of the market as a result of the tax is represented by the area that was previously accessible to consumers but is no longer due to the increased price from the tax. This area is typically calculated as a triangular or rectangular area under the demand curve but above the new price level. Without the specific figure (Figure 8-2) to reference, the correct answer is based on common outcomes in such scenarios. However, given the options and typical outcomes of tax impacts in economic models, a loss of consumer surplus of $6 is a plausible amount for some buyers leaving the market due to increased costs from the tax. This answer assumes a standard supply and demand model where a tax increases the price buyers pay and decreases the price sellers receive, leading to a decrease in quantity sold and a loss in consumer surplus.

Figure 8-2 the Vertical Distance Between Points C and D Represents a Represents