Suppose the Canadian government has decided to place an excise tax of $20 per tire on producers of automobile tires. Excise taxes are also called sales or commodity taxes. Previously, there was no excise tax on automobile tires. As a result of the excise tax, producers of tires, such as Bridgestone and Michelin, are going to alter their tire prices. The graph illustrates the demand and supply curves for automobile tires before the excise tax. Please shift the appropriate curve or curves on the graph to demonstrate the impact of the new tax. What is the price consumers pay for a tire post tax? Round to the nearest 10. 150 140 130 120 88 28 110 100 90 80 70 8888 Price 60 50 0 1 2 3 4 Demad Supply 5 6 10 price paid by consumers: 100 Quantity

Suppose the Canadian government has decided to place an excise tax of $20 per tire on producers of automobile tires. Excise taxes are also called sales or commodity taxes. Previously, there was no excise tax on automobile tires. As a result of the excise tax, producers of tires, such as Bridgestone and Michelin, are going to alter their tire prices. The graph illustrates the demand and supply curves for automobile tires before the excise tax. Please shift the appropriate curve or curves on the graph to demonstrate the impact of the new tax. What is the price consumers pay for a tire post tax? Round to the nearest 10. 150 140 130 120 88 28 110 100 90 80 70 8888 Price 60 50 0 1 2 3 4 Demad Supply 5 6 10 price paid by consumers: 100 Quantity

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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