Suppose Luke values a scoop of Italian gelato at $4. Leia values a scoop of Italian gelato at $6. The pre-tax price of a scoop of Italian gelato is $2. The government imposes a per unit tax of $3 on each scoop of Italian gelato, and the price rises to $5. The deadweight loss from the tax is a- $4. b- $2. c- $1. d- $3

Principles of Economics, 7th Edition (MindTap Course List)
7th Edition
ISBN:9781285165875
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter8: Application: The Cost Of Taxation
Section: Chapter Questions
Problem 3QCMC
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Suppose Luke values a scoop of Italian gelato at $4. Leia values a scoop of Italian gelato at $6. The pre-tax price of a scoop of Italian gelato is $2. The government imposes a per unit tax of $3 on each scoop of Italian gelato, and the price rises to $5. The deadweight loss from the tax is

a- $4.
b- $2.
c- $1.
d- $3.
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