The Figure Below Is the Graph of the Demand Function

question 132

Multiple Choice

The figure below is the graph of the demand function D, the supply function S, and the supply function after a $30 tax T for the same product. Is it possible for the government to earn no money if it keeps increasing taxes on this product? ​

• A)Yes
• B)No

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Definitions:

Normal Good

A product whose demand increases when consumer income rises and falls when consumer income decreases.

Income Increases

Refers to a rise in the amount of money that individuals or households receive, from sources such as wages, investments, or benefits.

Indifference Map

A graphical representation of a consumer's preferences for different combinations of goods, where each curve indicates all combinations that offer the same level of satisfaction or utility.

Indifference Curves

Graphs showing combinations of goods or services among which a consumer is indifferent, reflecting preferences and trade-offs.