What Happens to the Total Surplus in a Market When

question 188

Multiple Choice

What happens to the total surplus in a market when the government imposes a tax?

• A)Total surplus increases by the amount of the tax.
• B)Total surplus increases but by less than the amount of the tax.
• C)Total surplus decreases.
• D)Total surplus is unaffected by the tax.

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Definitions:

Refuse Payment

The act of declining to make a payment that is due, often due to a dispute over the service or goods provided.

Equitable Remedy

Legal solutions based on fairness rather than fixed legal rules, often involving actions like injunctions or specific performance.

Injunction

A judicial order that restrains a party from beginning or continuing an action threatening or invading the legal right of another.

Legal Position

The specific rights, duties, or standpoints held or taken in a legal action or argument.