Bob places a 10 value on a glass of red wine and keith, Ask an Expert

Economics

Bob places a $10 value on a glass of red wine, and Keith places an $8 value on it. If there is no tax on glasses of red wine, the price of a glass of red wine reflects the cost of making it. The equilibrium price for a glass of red wine is $6. Suppose the government levies a tax of $3 on each glass of red wine, and the equilibrium price of a glass of red wine increases to $9. What is total consumer surplus after the tax is levied? ( $4 ? $6? $3? $1?)

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Business Economics, Economics

Category:- Business Economics
Reference No.:- M91705916

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