Suppose the government imposes a $10 per unit tax on a good (see diagram below) causing buyers to pay $18 for the item compared with an original equilibrium price of $12. What is the tax revenue the government collects from the sale of this item? Price 24 22 20 A 18 Supply 16 14- 12 10- H 6. 4 K M Demand 2. 369 12 15 18 21 24 27 30 33 36 39 Quantity $100 $80 O $120 O$60 +++

Suppose the government imposes a $10 per unit tax on a good (see diagram below) causing buyers to pay $18 for the item compared with an original equilibrium price of $12. What is the tax revenue the government collects from the sale of this item? Price 24 22 20 A 18 Supply 16 14- 12 10- H 6. 4 K M Demand 2. 369 12 15 18 21 24 27 30 33 36 39 Quantity $100 $80 O $120 O$60 +++

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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