If the Tax on a Good Is Increased from $0

question 334

Multiple Choice

If the tax on a good is increased from $0.10 per unit to $0.40 per unit,the deadweight loss from the tax

• A) remains constant.
• B) increases by a factor of 4.
• C) increases by a factor of 9.
• D) increases by a factor of 16.

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Oral Communications

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