The figure below illustrates the effect of an excise tax (per unit tax) imposed on buyers (D means demand and S meanssupply). How much of the tax revenue is actually paid by buyers?Price$60$40$30E1E104050SafterD taxDQuantity 40O a. 1/4 of the tax revenue.O b. 3/4 of the tax revenue.O c. 1/2 of the tax revenue.O d. 1/3 of the tax revenue.O e. 2/3 of the tax revenue.Check50afteD tax

The market equilibrium(E) is a point where the supply(S) of a product matches the demand(D) for it.…

Answered: The figure below illustrates the effect…

The figure below illustrates the effect of an excise tax (per unit tax) imposed on buyers (D means demand and S means supply). How much of the tax revenue is actually paid by buyers? Price S $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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Question

The figure below illustrates the effect of an excise tax (per unit tax) imposed on buyers (D means demand and S means
supply). How much of the tax revenue is actually paid by buyers?
Price
$60
$40
$30
E
1
E
10
40
50
S
after
D tax
D
Quantity

40
O a. 1/4 of the tax revenue.
O b. 3/4 of the tax revenue.
O c. 1/2 of the tax revenue.
O d. 1/3 of the tax revenue.
O e. 2/3 of the tax revenue.
Check
50
afte
D tax

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