Multiple Choice
The demand and supply curves for a product are QD = 50 - 0.5P and QS = 2.5P + 5, where P is the price per unit and Q measures millions of units. If the government levies a $1.20 per unit tax on buyers, what is the size of the deadweight loss?
A) $300,000
B) $500,000
C) $800,000
D) $1.2 million
Correct Answer:
Verified
Correct Answer:
Verified
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