A consumer values a car at $30,000 and a producer values the same car at $20,000.If the transaction is completed at $24,000,what level of sales tax will result in unconsummated transaction?

Question

​A consumer values a car at $30,000 and a producer values the same car at $20,000.If the transaction is completed at $24,000,what level of sales tax will result in unconsummated transaction?

Quizplus · Accepted Answer

If the sales tax is 40%, the total cost to the consumer would be $24,000 + (0.40 * $24,000) = $33,600, which exceeds the consumer's valuation of $30,000, leading to an unconsummated transaction.

​A Consumer Values a Car at $30,000 and a Producer

A Consumer Values a Car at $30,000 and a Producer