The above blue area is the amount of the indirect tax paid by producers. Producers receive £7 per unit sold, and with a £7 per unit tax on each unit, the new market price is £14. As the initial equilibrium price was £10, producers pay £3 of the tax per unit, and consumers pay £4.
Choice A is incorrect, as that is the amount of the tax paid by consumers.
Choice B is incorrect as that is the total amount of the tax.
Choice D is incorrect as that is total revenue (to the government and producers).
