Multiple Choice
Use the figure below to answer the following question(s) .
Figure 4-7
-Refer to Figure 4-7.The supply curve S₁ and the demand curve D indicate initial conditions in the market for gasoline.A $.60-per-gallon excise tax on gasoline is levied,which shifts the supply curve from S₁ to S₂.Imposing the tax causes the equilibrium price of gasoline to increase from
A) $.80 to $1.40.
B) $.80 to $1.50.
C) $.90 to $1.50.
D) $.90 to $1.40.
Correct Answer:

Verified
Correct Answer:
Verified
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