Figure 6-19
-Refer to Figure 6-19.Suppose a tax of $2 per unit is imposed on this market.How much will buyers pay per unit after the tax is imposed?

Question

Figure 6-19 
-Refer to Figure 6-19.Suppose a tax of $2 per unit is imposed on this market.How much will buyers pay per unit after the tax is imposed?

Quizplus · Accepted Answer

After a $2 tax is imposed, the price buyers pay per unit will increase by the amount of the tax. If the initial equilibrium price was between $3 and $5, adding the $2 tax would result in a price between $5 and $7.

Figure 6-19 -Refer to Figure 6-19.Suppose a Tax of $2 Per Unit