On the diagram, D1 represents the demand curve for Indian tea and S1 shows the original supply curve. The Indian government introduces a tax on tea, so the supply curve moves to S2. Which areas on the diagram show the tax revenue earned by the Indian government and the new producer surplus?
- Atax revenue: w + x; new producer surplus: v
- Btax revenue: w + x; new producer surplus: w
- Ctax revenue: w + x + y; new producer surplus: v
- Dtax revenue: w + x + y; new producer surplus: w