Tax Impact on Market Dynamics

Tax Impact on Market Dynamics

Assessment

Interactive Video

Business, Mathematics, Social Studies

11th - 12th Grade

Hard

Created by

Patricia Brown

FREE Resource

The video tutorial explores the impact of a government-imposed tax on the market, focusing on supply and demand curves. It models the tax as a shift in the supply curve, leading to a new market equilibrium. The tutorial explains how the tax affects consumer and producer surplus, and how it generates tax revenue for the government. It also highlights the concept of deadweight loss, which represents the inefficiency introduced by the tax.

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10 questions

Show all answers

1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What happens to the supply curve when a tax is imposed on sellers?

It shifts to the left.

It shifts to the right.

It becomes vertical.

It remains unchanged.

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

How is the amount of tax represented on a graph?

As the slope of the supply curve.

As the vertical distance between supply curves.

As the horizontal distance between demand curves.

As the area under the demand curve.

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

If a $2 tax is imposed, what is the new price consumers pay if the original price was $5?

$3

$7

$5

$6

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is consumer surplus?

The area above the supply curve.

The area between the supply and demand curves.

The area above the demand curve.

The area below the demand curve.

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

How does tax affect consumer surplus?

It has no effect on consumer surplus.

It decreases consumer surplus.

It doubles consumer surplus.

It increases consumer surplus.

6.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What does the area representing tax revenue look like on a graph?

A triangle below the supply curve.

A rectangle between the new equilibrium price and the original supply curve.

A triangle above the demand curve.

A rectangle between the supply curves.

7.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

How is producer surplus affected by a tax?

It becomes negative.

It remains the same.

It decreases.

It increases.

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