Tackle the Test: Free-Response Questions

  1. Question

    Refer to the graph provided. Assume the government has imposed an excise tax of $60 on producers in this market.

    image
    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

    Rubric for FRQ 1 (6 points)

    1 point: 1,000

    1 point: $90

    1 point: Consumer surplus will decrease by $45,000, from ½ ($2,000 × 60) = $60,000 before the tax to ½ ($1,000 × 30) = $15,000 after the tax.

    1 point: Producer surplus will decrease by $45,000, from ½ ($2,000 × 60) = $60,000 before the tax to ½ ($1,000 × 30) = $15,000 after the tax.

    1 point: $60 × 1,000 = $60,000

    1 point: ½ × $60 × 1,000 = $30,000

  2. Question

    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
    Draw a correctly labeled graph of a competitive market in equilibrium. Use your graph to illustrate the effect of an excise tax imposed on consumers. Indicate each of the following on your graph: