Economics Questions

Economics Questions Glendale Community College Econ 101 Winter 2022 Test 2 Question 2

Suppose that the market in the graph above is at an initial equilibrium price of $10 and an equilibrium quantity of 500 units. If the government decides to add a $4 per-unit tax on this good, the equilibrium price will change to:

a. $12

b. $4

c. $8

d. $14


Answer:  A. $12