Figure 8-3 the Vertical Distance Between Points a and C Represents a Represents

question 227

Multiple Choice

Figure 8-3
The vertical distance between points A and C represents a tax in the market.
-Refer to Figure 8-3.Which of the following equations is valid for the deadweight loss of the tax?

• A)Deadweight loss = (1/2)(P2 - P1)(Q2 + Q1)
• B)Deadweight loss = (1/2)(P3 - P1)(Q2 + Q1)
• C)Deadweight loss = (1/2)(P3 - P2)(Q2 - Q1)
• D)Deadweight loss = (1/2)(P3 - P1)(Q2 - Q1)

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