Figure 8-2The vertical distance between points A and B represents a tax in the market.Price12 *11+10 +SupplyA98+7-643+21Demand++45 505 1 15 2 25 3 35 4QuantityRefer to Figure 8-2. Total surplus without the tax is$10, and total surplus with the tax is $2.50.$10, and total surplus with the tax is $7.50.$20, and total surplus with the tax is $2.50.$20, and total surplus with the tax is $7.50.

In any market, total surplus measures the total wellbeing of all participants in that market- namely…

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The vertical distance between points A and B represents a tax in the n 1Price 12 11+ 10 Supply 9 8+ 3

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ISBN:9780190931919

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Chapter1: Making Economics Decisions

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Question

Figure 8-2
The vertical distance between points A and B represents a tax in the market.
Price
12 *
11+
10 +
Supply
A
9
8+
7-
6
4
3+
2
1
Demand
++
45 5
05 1 15 2 25 3 35 4
Quantity
Refer to Figure 8-2. Total surplus without the tax is
$10, and total surplus with the tax is $2.50.
$10, and total surplus with the tax is $7.50.
$20, and total surplus with the tax is $2.50.
$20, and total surplus with the tax is $7.50.

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