Figure 4-8

Figure 4-8 shows the market for beer. The government plans to impose a per-unit tax in this market.
-Refer to Figure 4-8.How much of the tax is paid by sellers?

Question

Figure 4-8
  
Figure 4-8 shows the market for beer. The government plans to impose a per-unit tax in this market.
-Refer to Figure 4-8.How much of the tax is paid by sellers?

Quizplus · Accepted Answer

The amount of tax paid by sellers is determined by the difference between the price sellers receive after the tax and the original equilibrium price. If the tax shifts the supply curve upward by $2, then sellers pay $2 of the tax.

Figure 4-8 Figure 4-8 Shows the Market for Beer. the Government Plans