For Widgets, the Supply Curve Is the Typical Upward-Sloping Straight

question 129

Multiple Choice

For widgets, the supply curve is the typical upward-sloping straight line, and the demand curve is the typical downward-sloping straight line. A tax of $15 per unit is imposed on widgets. The tax reduces the equilibrium quantity in the market by 250 units. The deadweight loss from the tax is

• A)$3,750.
• B)$1,875.
• C)$132.5.
• D)$117.5.

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Definitions:

Mean

The mean, often referred to as the average, is a statistic that represents the central or typical value in a set of data, calculated by dividing the sum of all values by the number of values.

Population Standard Error

A measure that estimates the variability of sample means around the population mean if multiple samples were taken from the population.

Confidence Interval

A band of values, yielded by analyzing sample data, which has a good chance of capturing the value of an unknown population variable.

Mean

The average value obtained by dividing the sum of all values in a set by the number of values.