Suppose a Tax of $4 Per Unit Is Imposed on a Good,and

question 103

Multiple Choice

Suppose a tax of $4 per unit is imposed on a good,and the tax causes the equilibrium quantity of the good to decrease from 2,000 units to 1,700 units.The tax decreases consumer surplus by $3,000 and decreases producer surplus by $4,400.The deadweight loss of the tax is

• A)$200.
• B)$400.
• C)$600.
• D)$1,200.