Refer to the graph shown. Assume that the market is initially in equilibrium at a price of $10 and a quantity of 500 units. If the government imposes a $4 per-unit tax on this product, the equilibrium price will change to:
A. $8.
B. $4.
C. $12.
D. $14.
Answer: C
You might also like to view...
Because of the existence of comparative advantage, the total output of goods is higher when each producer
A) produces many different goods. B) produces at the midpoint of its PPF. C) specializes in the production of one good or a few goods. D) makes both intermediate and final goods.
Which of the following would shift the supply curve for MP3 players to the left?
A) an increase in the price of an input used to produce MP3 players B) a decrease in consumer tastes for MP3 players C) an increase in the productivity of the workers who produce MP3 players D) an increase in the number of firms that produce MP3 players
Which of the following items is likely to have the highest income elasticity of demand?
A) water B) a hamburger C) a luxury cruise to several European countries D) breakfast cereal
The total cost curve generally has
A. slope values that first decrease and then increase rapidly. B. slope values that first increase rapidly and then decrease. C. increasing slope values. D. decreasing slope values.