Figure 8-7
The vertical distance between points A and B represents a tax in the market.

-Refer to Figure 8-7.Before the tax is imposed,the equilibrium price is
A) $16, and the equilibrium quantity is 15.
B) $12, and the equilibrium quantity is 15.
C) $12, and the equilibrium quantity is 25.
D) $8, and the equilibrium quantity is 15.

Question

Figure 8-7
The vertical distance between points A and B represents a tax in the market.
 
-Refer to Figure 8-7.Before the tax is imposed,the equilibrium price is
A) $16, and the equilibrium quantity is 15. 
B) $12, and the equilibrium quantity is 15. 
C) $12, and the equilibrium quantity is 25. 
D) $8, and the equilibrium quantity is 15.

Quizplus · Accepted Answer

The equilibrium price and quantity are determined where the supply and demand curves intersect. According to the given options, $12 and 25 units match this intersection point before the tax is imposed.

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