A Level Economics (9708)•9708/11/O/N/20

Explanation
Tax Incidence on Consumers Steps:
- Locate original equilibrium where demand intersects S, noting price P and quantity Q.
- Identify new equilibrium where demand intersects S_t, with consumer price P_c and quantity Q_t.
- Calculate tax burden on consumers as P_c minus P, the price increase.
- From diagram, this vertical distance measures $1000.
Why B is correct:
- Consumer tax burden equals price rise post-tax, per tax incidence theory, matching $1000 diagram value.
Why the others are wrong:
- A: Understates consumer burden; confuses with producer share.
- C: Overstates by including full tax or total revenue.
- D: Irrelevant; likely total tax revenue at new quantity.
Final answer: B
Topic: Methods and effects of government intervention in markets
Practice more A Level Economics (9708) questions on mMCQ.me