Government-imposed taxes cause reductions in the activity that is being taxed, which has important implications for revenue collections. To understand the effect of such a tax, consider the monthly market for gin, which is shown on the following graph. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. Suppose the government imposes a $20-per-bottle tax on suppliers. At this tax amount, the equilibrium quantity of gin is____ bottles, and the government collects_____ in tax revenue.
Government-imposed taxes cause reductions in the activity that is being taxed, which has important implications for revenue collections. To understand the effect of such a tax, consider the monthly market for gin, which is shown on the following graph. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. Suppose the government imposes a $20-per-bottle tax on suppliers. At this tax amount, the equilibrium quantity of gin is____ bottles, and the government collects_____ in tax revenue.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
Government-imposed taxes cause reductions in the activity that is being taxed, which has important implications for revenue collections.
To understand the effect of such a tax, consider the monthly market for gin, which is shown on the following graph.
Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph.
Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly.
Suppose the government imposes a $20-per-bottle tax on suppliers.
At this tax amount, the equilibrium quantity of gin is____
bottles, and the government collects_____
in tax revenue.
Transcribed Image Text:Graph Input Tool
(?)
Market for Gin
100
I Quantity
(Bottles)
90
Supply
80
80
Supply Price
(Dollars per bottle)
Demand Price
60.00
40.00
70
(Dollars per bottle)
Таx
60
20.00
(Dollars per bottle)
出
50
40
30
Demand
20
10
+
20
40
60
80
100 120 140 160 180 200
QUANTITY (Bottles)
PRICE (Dollars per bottle)
ㅇ
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