Use the Following to Answer Questions

question 180

Multiple Choice

Use the following to answer questions:
Figure: Commodity Tax on Suppliers
-(Figure: Commodity Tax on Suppliers) Refer to the figure. If a tax shifts the supply curve from S₁ to S₂, the value of deadweight loss is:

• A) $200.
• B) $100.
• C) $50.
• D) $25.

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Definitions:

Preferred Shares

Preferred shares are a type of equity security that typically provide dividends and asset liquidation preference over common shares but usually do not carry voting rights.

Common Shares

Equity securities that represent ownership in a corporation, giving holders voting rights and a share in the company’s profits through dividends.

Cash Dividends

Payments made by a corporation to its shareholder members from current or retained earnings, usually in the form of cash.