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Assume That a Tax Is Levied on a Good and That

Question 92

Multiple Choice

Assume that a tax is levied on a good and that the government uses the revenue to clean up lethal toxic waste that would cause irreparable harm to a large number of people.In this case,which of the following outcomes would NOT occur


A) a decrease in consumer surplus to consumers of the taxed good
B) a decrease in producer surplus to producers of the taxed good
C) an increase in the total economic welfare of society
D) a decrease in the total economic welfare of society

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