The above figure shows supply and demand curves for milk. If the government passes a $2 per gallon specific tax, the welfare loss will equal

Based on the above figure showing a budget line, which of the following combinations of soda and bottled water are not affordable?

A) 3 bottles of water and 4 cans of soda B) 4 bottles of water and 2 cans of soda C) 2 bottles of water and 6 cans of soda D) None of the above, that is, all the combinations listed are affordable.

The actual division of the burden of a tax is called

A) tax incidence. B) tax dispersion. C) tax credit. D) excess burden.