Within the market of Cacao, the government intends to install a tax of cents per kilogram of Cacao.Prior to the introduction, the market clearing price and quantity have been cents per kilogram and kilos, respectively.The subsequent illustration examplifies the situation. Both elasticities, the price elasticity of supply and of demand, are isoelastic.

The introduction of a tax willlead to

a a deadweight loss

b an increase in welfarethrough an expansion of the both surpluses

c an increase in welfare through an expansion of theconsumer surplus

d an increase in wellfare through an expansion of the supplier surplus

The introduction of a tax will affect:

a the consumer and producer surplus to the same extent

b the consumer surplus morethan the producer surplus

c The producer surplus more than the consumer surplus.

The tax\'s effect on theconsumer surplus will be equal to

The tax\'s effect on the producer surplus will be equal to

The overall welfare effect will be