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Suppose That a Market Is Initially in Equilibrium P=90QdP = 90 - Q ^ { d }

Question 20

Multiple Choice

Suppose that a market is initially in equilibrium. The initial demand curve is P=90QdP = 90 - Q ^ { d } . The initial supply curve is P=2Q5P = 2 Q ^ { 5 } . Suppose that the government imposes a $3 tax on this market. What is the dead-weight loss due to the tax?


A) $3.
B) $2.
C) $1.50.
D) $1.00.

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