Figure 5.7 Figure 5.7 shows the market for beer.The government plans to impose a unit tax in this market.
-Refer to Figure 5.7.How much of the tax is paid by producers?

Question

Figure 5.7  Figure 5.7 shows the market for beer.The government plans to impose a unit tax in this market.
-Refer to Figure 5.7.How much of the tax is paid by producers?

Quizplus · Accepted Answer

The amount of tax paid by producers is determined by the difference between the price they receive before and after the tax is imposed. If Figure 5.7 shows that producers receive $2 less per unit after the tax, then they pay $2 of the tax.

Figure 57 Figure 5