39. Assuming a $7 per unit tax is imposed, in calculating the realative burdent of the tax does it matter whether the government is collecting the tax directly from sellers or from buyers? YES NO 28 P242016128400 4 8121620SD24 Q

Answered: Assuming a $7 per unit tax is imposed,…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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39. Assuming a $7 per unit tax is imposed, in calculating the realative burdent of the tax does it matter whether the government is collecting the tax directly from sellers or from buyers?

YES

NO

28 P
24
20
16
12
8
4
0
0 4 8
12
16
20
S
D
24 Q

Expert Solution

Step 1

Government imposed a tax of $7, it will decrease the supply and shifts it to the left by the amount of tax at each level of quantity.

As we see, the supply curve shifted leftward by $7 for every unit of Q.

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