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Refer to the Following Graph

question 29

Multiple Choice

Refer to the following graph. If this graph represents the supply of and demand for an imported product, a tariff of t will result in revenue for the government shown by area:

Definitions:

Compound Interest

Interest calculated on the initial principal and also on the accumulated interest of previous periods of a deposit or loan.

Principal

The original sum of money borrowed in a loan, or the initial amount of investment, excluding any interest or dividends.

Maturity Value

The amount that will be received at the maturity date of an investment, including the principal and any accrued interest.

Future Value

The value of an asset or cash at a specified date in the future calculated based on assumed rate of growth or interest.