Use the Following to Answer Questions

question 220

Multiple Choice

Use the following to answer questions:
Figure: Demand Tax
-(Figure: Demand Tax) The figure illustrates a market for gasoline with a $1 tax imposed on the buyers. What price do sellers receive for a gallon of gasoline in this market?

• A) $3.50
• B) $3
• C) $2.50
• D) between $2.50 and $3.50, depending on the elasticity of supply

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Depressed Client

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