Figure 8-7 the Vertical Distance Between Points a and B Represents a Represents

question 124

Multiple Choice

Figure 8-7
The vertical distance between points A and B represents a tax in the market.
-Refer to Figure 8-7.Suppose a 20^th unit of the good were sold by a seller to a buyer.Which of the following statements is correct?

• A)For the 20^th unit,the difference between the buyer's value and the seller's cost is less than the tax per unit.
• B)For the 20^th unit,the difference between the buyer's value and the seller's cost is greater than the tax per unit.
• C)For the 20^th unit,the difference between the buyer's value and the seller's cost is equal to the tax per unit.
• D)It makes sense for the buyer to buy and for the seller to sell the 20^th unit,with or without the tax in place.

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Definitions:

Enforceable Agreement

A contract or agreement that can be upheld and compelled by law.

Mirror-Image Rule

A contract law principle stating that an acceptance must exactly match the terms of the offer for a legally enforceable agreement to exist.

Bilateral Contract

A legal agreement involving two parties where each promises to perform an act in exchange for the other's act.

Principles Of European Contract Law

A set of guidelines aimed at harmonizing contract law across European countries to facilitate cross-border trade and cooperation.