(Figure: Tax on Buyer) Refer to the graph which shows a tax on a buyer. Using the graph, answer the following questions:
(i) What was the equilibrium price before the implementation of the tax?
(ii) What price do buyers pay after the implementation of the tax?
(iii) What price do sellers get after the implementation of the tax?
(iv) What was the equilibrium quantity (in units) before the implementation of the tax?
(v) What is the new equilibrium quantity (in units) after the implementation of the tax?
(vi) The amount of the tax is $_______ per unit of the item.
(vii) The economic burden of the tax on the buyer is $_______ per unit of the item.
(viii) The economic burden of the tax on the seller is $_______ per unit of the item.
Correct Answer:
Verified
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