The Graph Shown Demonstrates a Tax on Buyers

question 116

Multiple Choice

The graph shown demonstrates a tax on buyers. How many fewer units are being sold due to the imposition of a tax on this market?

• A)6
• B)9
• C)3
• D)12

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Definitions:

Net Realizable Value

The estimated selling price of goods, minus the estimated cost of completion and any costs necessary to make the sale.

Retained Earnings

Profits that a company keeps or retains rather than distributing to shareholders as dividends, often used for reinvestment.

Overstated

The description of financial statements or figures that have been reported at amounts higher than is factual or realistic.

Understated

Understated refers to financial information that is reported at a figure less than the actual value, inadvertently decreasing net income or asset values.