Figure 8-2
The vertical distance between points A and B represents a tax in the market.
-Refer to Figure 8-2. The amount of tax revenue received by the government is
A) $2.50.
B) $4.
C) $5.
D) $9.

Question

Figure 8-2
The vertical distance between points A and B represents a tax in the market. 
-Refer to Figure 8-2. The amount of tax revenue received by the government is
A) $2.50. 
B) $4. 
C) $5. 
D) $9.

Quizplus · Accepted Answer

The tax revenue is equal to the area of the rectangle formed by the tax per unit and the quantity sold. In this case, the tax per unit is $1 and the quantity sold is 5, so the tax revenue is $5. Thus, choice C is the correct answer.

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