Daily Demand for Gasoline at Billy-Bob's Mobile Station Is Described

Daily demand for gasoline at Billy-Bob's Mobile Station is described by Q = 776 - 200p, where Q are gallons of gasoline sold and p is the price in dollars. Billy-Bob's supply is Q = 2890 + 1,500p. Suppose the state government places a tax of 20 cents on every gallon of gasoline sold. What is the deadweight loss resulting from this tax?

A) 3.53 dollars
B) 3.11 dollars
C) 0.42 dollars
D) 96.12 dollars
E) 34.59 dollars

Correct Answer:

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