Suppose That a Market Is Initially in Equilibrium

question 49

Multiple Choice

Suppose that a market is initially in equilibrium.The initial demand curve is The initial supply curve is Suppose that the government imposes a $3 tax on this market.How much of this $3 tax is paid by consumers?

• A) $1.
• B) $1.50.
• C) $2.
• D) $3

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Definitions:

Prescriptive Theory

A theoretical approach that provides specific guidelines or frameworks for action to achieve desired outcomes.

Descriptive Theory

A theory that aims to accurately describe how certain phenomena occur or exist in reality.

Discrepancy

A divergence or difference between two or more items, situations, or values, often leading to a realization of a problem or a gap that needs addressing.

Effective

The degree to which something achieves its intended result, outcome, or goal with a minimum of wasted effort or expense.