Question: Figure 8-7 The vertical distance between points A and B represents a tax in the market. Refer to Figure 8-7 . The deadweight loss associated

Figure 8-7

The vertical distance between points A and B represents a tax in the market.

Refer to Figure 8-7. The deadweight loss associated with this tax amounts to

a.$80, and this figure represents the surplus that is lost because the tax discourages mutually advantageous trades between buyers and sellers.b.$60, and this figure represents the amount by which tax revenue to the government exceeds the combined loss of producer and consumer surpluses.c.$80, and this figure represents the amount by which tax revenue to the government exceeds the combined loss of producer and consumer surpluses.d.$60, and this figure represents the surplus that is lost because the tax discourages mutually advantageous trades between buyers and sellers.

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