A Tax of $0

question 125

Multiple Choice

A tax of $0.25 is imposed on each bag of potato chips that is sold. The tax decreases producer surplus by $600 per day, generates tax revenue of $1,220 per day, and decreases the equilibrium quantity of potato chips by 120 bags per day. The tax

• A)decreases consumer surplus by $645 per day.
• B)decreases the equilibrium quantity from 6,000 bags per day to 5,880 bags per day.
• C)decreases total surplus from $3,000 to $1,800 per day.
• D)creates a deadweight loss of $15 per day.

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Definitions:

POST

Power-On Self-Test, an initial set of diagnostic tests performed by a computer's firmware that checks the system's hardware components and ensures everything is working properly before starting up.

GUI

Stands for Graphical User Interface, a visual way of interacting with a computer using items like windows, icons, and menus, instead of text-based commands.

Pin

A personal identification number, which is a numeric or alphanumeric password used in securing access to devices or digital accounts.

Desktop

A personal computer designed to fit on or under a desk, distinct from portable laptops or mobile devices.