Question

Suppose that the U.S. government decides to charge beer consumers a tax. Before the tax, 25,000 cases of beer were sold every week at a price of $4 per case. After the tax, 19,000 cases of beer are sold every week; consumers pay $5 per case (including the tax), and producers receive $1 per case. The amount of the tax on a case of beer is $_______ per case. Of this amount, the burden that falls on consumers is $____ per case, and the burden that falls on producers is $ ----- per case True or False: The effect of the tax on the quantity sold would have been larger if the tax had been levied on producers

Answer #1

The amount of the tax on a case of beer is $1 per case. Of this amount, the burden that falls on consumers is $1 per case, and the burden that falls on producers is $4 per case is true. No the effect of the tax on the quantity sold would have been larger if the tax had levied on producers is get effected by the quantity sold the ultimately the producer will charge the amount form the direct to the customer they will not going to beer the price of tax which is impose by the government only the quanity sold for the per case beer will be reduce.

As the price of the good increase the demand for the commodity will decrease and if the price of goods will decrease the goods become more dearer and as a result the supply will also increase.

Calculating tax incidence
Suppose that the U.S. government decides to charge beer
consumers a tax. Before the tax, 50,000 cases of beer were sold
every week at a price of $7 per case. After the tax, 43,000 cases
of beer are sold every week; consumers pay $10 per case (including
the tax), and producers receive $5 per case.
The amount of the tax on a case of beer is $_____
per case. Of this amount, the burden that falls on...

2.Calculating tax incidence
Suppose that the U.S. government decides to charge beer
producers a tax. Before the tax, 30 million cases of beer were sold
every month at a price of $6 per case. After the tax, 24 million
cases of beer are sold every month; consumers pay $7 per case, and
producers receive $3 per case (after paying the tax).
The amount of the tax on a case of beer is __ per case. Of this
amount, the burden...

Suppose that the U.S. government decides to charge wine
producers a tax. Before the tax, 30,000 bottles of wine were sold
every week at a price of $7 per bottle. After the tax, 25,000
bottles of wine are sold every week; consumers pay $9 per bottle,
and producers receive $6 per bottle (after paying the tax). The
amount of the tax on a bottle of wine is $_____ per bottle. Of this
amount, the burden that falls on consumers is...

Suppose that the U.S. government decides to charge wine
producers a tax. Before the tax, 10 million bottles of wine were
sold every month at a price of $4 per bottle. After the tax, 3
million bottles of wine are sold every month; consumers pay $7 per
bottle, and producers receive $2 per bottle (after paying the
tax).
The amount of the tax on a bottle of wine is -----per bottle. Of
this amount, the burden that falls on consumers...

Suppose that the U.S. government decides to charge wine
producers a tax. Before the tax, 50 million bottles of wine were
sold every month at a price of $6 per bottle. After the tax, 43
million bottles of wine are sold every month; consumers pay $9 per
bottle, and producers receive $4 per bottle (after paying the
tax).
The amount of the tax on a bottle of wine is ______ per bottle.
Of this amount, the burden that falls on...

5. Calculating tax incidence
Suppose that the U.S. government decides to charge wine
producers a tax. Before the tax, 15,000 bottles of wine were sold
every week at a price of $7 per bottle. After the tax, 10,000
bottles of wine are sold every week; consumers pay $9 per bottle,
and producers receive $6 per bottle (after paying the tax). The
amount of the tax on a bottle of wine is $ ? per bottle. Of this
amount, the burden...

5. Calculating tax incidence Suppose that the U.S. government
decides to charge wine producers a tax. Before the tax, 40 billion
bottles of wine were sold every year at a price of $5 per bottle.
After the tax, 34 billion bottles of wine are sold every year;
consumers pay $6 per bottle, and producers receive $2 per bottle
(after paying the tax). The amount of the tax on a bottle of wine
is $ per bottle. Of this amount, the...

Incidence of an excise tax or who bears
the burden of the tax. The table shows the demand and
supply schedules for cases of
beer (in thousands).
Quantity
Price
Before-tax
After-tax
demanded
per case($)
quantity
supplied
quantity supplied
300
11.40
900
__________
350
11.20
800
__________
400
11.00
700
c.
_______
450
10.80
600
b.
_______
500
10.60
500
a.
_______
550 ...

Suppose the average monthly demand for cigarettes can be
described by the equation QD = 30−p, and supply can be described by
the equation QS = 18+2p, where p is the price of a pack of
cigarettes. When there is no tax on cigarettes, the equilibrium
price is p0 =$4 per pack and Q0 =26.
(a) Suppose the government sets a specific tax on tobacco
producers of τ = $1.50 per pack to reduce tobacco consumption. How
much do consumers...

When the government imposes a tax on the sale of a particular
good, the sellers try to pass the tax onto consumers by raising the
price of the good sold. Assume you own a tire company, and the
government decides to impose a $1.00 tax on each tire sold. 1.
Based on the basics of supply and demand, explain what would likely
happen to the price you charge and the quantity of tires sold. 2.
Would the amount of the...

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