Suppose that the government decides to charge cola consumers an excise tax. Before the tax, 12 million cases of cola are sold every month at a price of $3.50 per case. After the tax, 6 million cases of cola are sold every month; consumers pay $4.00 per case and producers receive $2.00 per case. Use this information to answer the following questions.
2007-09-23 14:06:43 · 2 answers · asked by haris d 1 in Social Science ➔ Economics
The tax is $2. It would help if you asked the questions.
Incidence of tax on consumers is 50 cents.
2007-09-25 05:00:58 · answer #1 · answered by Anonymous · 0⤊ 0⤋
Where are the following questions? You didn't ask any, so I'll ask you some.
Also, do you mean that there is a 50 cents per carton tax? I doubt that such a small tax (about 15%) would have such a drastic effect.
Who got the $3.50 before? Why are producers only getting $2 now?
2007-09-24 01:00:52 · answer #2 · answered by jemhasb 7 · 0⤊ 0⤋