(Answered) Consider a market with a demand given

Management Studies

Consider a market with a demand given by Q^d=600-60P and the market supply is Q^s = 40P. A tax of $3 per unit is imposed. Which of the following statements is true?

A. After the tax, the equilibrium is p^b = 6, p^s = 3 and Q^T = 240

B. After the tax, the equilibrium is p^b = 9, p^s = 6 and Q^T = 240

C. The government revenue from the tax is 240×$3=$720

D. The deadweight loss from this tax is zero.

E. None of the above

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