Figure 4-17 -Refer to Figure 4-17.Suppose the Market Is Initially in Equilibrium

Multiple Choice

Figure 4-17
-Refer to Figure 4-17.Suppose the market is initially in equilibrium at price P1 and then the government imposes a tax on every unit sold.Which of the following statements best describes the impact of the tax?

A) The consumer will bear a smaller share of the tax burden if the demand curve is D1.
B) The consumer's share of the tax burden is the same whether the demand curve is D1 or D2.
C) The consumer will bear a smaller share of the tax burden if the demand curve is D2.
D) The consumer will bear the entire burden of the tax if the demand curve is D2 and the producer will bear the entire burden of the tax if the demand curve is D1.