Refer to the Graph Shown

question 100

Multiple Choice

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, consumer surplus will fall from:

• A) 2,500 to 1,600.
• B) 5,000 to 3,200.
• C) 2,500 to 1,200.
• D) 5,000 to 2,500.